Is my equity safe?

[hk$]

This is my first post so please help me if you can.
I am awaiting a discharge and closing on a CH7. Our case is a no asset case.
Our discharge is expected on 1/20.

Since our filing homes in our subdivision have been selling for alot more than our value we listed in our filing. Can we sell our home for the going price and it be ok with the courts? Lets say we listed the value at $250K and wanted to sale our home in a year from $300K. Lets also say we ow $230K on it and the Trustee did not mention the equity at all at our 341 hearing. Will that fly?

I posed the question to my attorney and he said that once the case closes we are free to do what we want. I know he is the professional but I wanted to hear your views on it.

Thanks in advance.

[StaciMM]

What state did you file in? That will help determine what you can exempt in equity. (Also-are you the sole owner of the house, or is someone else listed as well and did you file file joint or single?)

If your equity is exempt, there will probably not be an issue. On the other hand, if the new selling price is above your exemption amount, you'll be better off waiting a while to sell. The trustee can re-open your case for a year after it is closed, and I'm guessing that mis-reported home equity would be a valid reason...

[hk$]

The filing was in NC. It was a joint filing. The house is in my wife and I's name. So was my attorney correct when he stated that after it closes, we can sell it for whatever and it won't affect anything?

[StaciMM]

Your attorney certainly knows more than I do, but if I were you-I'd be cautious.

Bankruptcy Action.com shows $37,000 allowed in home equity (for joint filing) though I don't know if this is an accurate, up to date figure. If you sell it for $300,000-and the trustee finds out-it may be possible that he'll move to reopen your case, claiming you fraudulently under-reported the value of your home and change it to an asset case. I don't know how likely that is, so my best recommendation is to try to ask around for the opinions of a couple of other BK attorneys in your area.

One other thought-if you're thinking about buying another house when yours sells, you can do better with that if you take some time to clean up your credit report.

[bkfiler]

well i certainly dont know but i will say that you will probably be fine. i dont beleive the trustee's are going to check up on you after you file. they would need a reason to go back and check given all the cases they handle. they are not going to just review all the cases again. this is what your attorney is probably speaking to. it makes sense.

also, if they did then they would have to determine fraud in how you listed your home on the petetion to get anything. so even if they came back at you could they prove fraud - which really means you listed the wrong amount intentionally or not lol.

ask yourself this - what was the amount of the house worth at the time you filed and had the 341 when you swore that nothing changed? that is the snapshot.

if you listed that amount on the form but it went up afterwards then you are almost certainly in the clear due to the situation stated in comments above.

if you listed it too low then you are probably still ok because again they probably wont check.

which case was it? listed to low or it went up afterwards?

[JimH]

Unless you are a certified appraiser or realtor, you are not held to the standard of a professional - it would have to be overly obvious fraud for him to protest. As long as you based the $250,000 value on "something", then it would be hard for the trustee to say much because he has an obligation to check these things too. At the very least, he could of checked the property tax record to see what it is assessed at.

[StaciMM]

Jim & Bkfiler make good points as always. Even so, throwing caution to the wind could end up costing you-not us. And, don't forget that in the end, the trustee probably has a pretty good record of winning when he sees dollar signs.

You have to decide if its a chance worth taking...

[bkfiler]

Unless you are a certified appraiser or realtor, you are not held to the standard of a professional - it would have to be overly obvious fraud for him to protest. As long as you based the $250,000 value on "something", then it would be hard for the trustee to say much because he has an obligation to check these things too. At the very least, he could of checked the property tax record to see what it is assessed at.

the word 'fraud' in bk cases is a misnomer of sorts. its doesnt have to mean you intentially did it that way, it can just mean that its listed wrong and since you filled/signed the forms then its you who are at fault for not knowing better.

silly term that makes people quake in their boots. fraud, abuse -whatever you wont get jailed for it.

[FilingOnMyOwn]

I would be safe and wait one full year before doing anything.