Selling house with equity

hello all, I filed chapter 7 in feb 2006 we were discharged june 2006. If I sold my house and after paying 1st and 2nd mortgages off I might have 20-30 left over. could I purchase another house using that as my downpayment without it being questioned by the trustee? Thanks

The Law on "windfalls" is 180 days from filing. You should be safe if your proceeds from the sale are in excess of your allowable Homestead Exemption.

Hi SinkingFast!

Does that vary from state to state? I could have sworn my Lawyer told me I had to worry about windfalls that might occur within one year of my discharge, not the filing date?

I'm curious as I'm about to sell the land my home used to be on.

When you file Ch 7 BK, you establish an entirely seperate entity. The BK Estate. As long as your BK proceeds normally and you're discharge in a timely fashion, with no Creditor Objections or any other types of delays, the BK Estate exists for 180 days from the date of filing.

§ 541. Property of the estate

(5) Any interest in property that would have been property of the estate if such interest had been an interest of the debtor on the date of the filing of the petition, and that the debtor acquires or becomes entitled to acquire within 180 days after such date—
(A) by bequest, devise, or inheritance;
(B) as a result of a property settlement agreement with the debtor’s spouse, or of an interlocutory or final divorce decree; or
(C) as a beneficiary of a life insurance policy or of a death benefit plan.

http://www.law.cornell.edu/uscode/html/uscode11/usc_sec_11_00000541----000-.html

In this case, the house was part of the BK Estate until the 180 days past. If they had sold within the 180 days, the Trustee could have taken any profit, above their allowable Homestead Exemption for the benefit of their Creditors.

The 1 year time period generally refers to re-examining a BK Case due to suspected Fraud.

Interesting! Thank you so much SinkingFast! That is good news for me! :D

Yup. It takes a couple months to sell anyways, so by the time you close would be early 07 and the 6 months would already have passed.