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    341 meeting concluded yesterday BUT

    Hi all, new poster here

    Im in the middle of a Chapter 7 no asset case. My 341 meeting was yesterday, took about 5 minutes and it went very well and it was concluded. The trustee looked at my lawyer during the meeting though and said "houses in so and so county are going up" and asked me to write down my phone number so a realtor could get in touch with me. It appears the trustee is questioning the assigned value of my home. After the meeting , my lawyer met with me outside the meeting room and told me not to worry or lose one minute of sleep over this (of course I did though) and that the trustee MIGHT send a realtor out for a "drive by" of my home but very likely not.

    The exemption here in Ga is $21,500.00. Based on the condition of my home, Im gonna guess there MAY be around 30,000 in equity but she must feel different. I just dont feel there is anything left for her to go after after paying me the 21,500 and a realtor 6%

    Has anyone had this happen before? My attorney says at the very worst case scenario, we turn it into a Chapter 13 but there are ways to appeal what a realtor estimates the home is worth. Im a worry wart that has had to start taking Buspar again for anxiety over all this. I have fallen on hard times and cant really afford a monthly payment of several hundred dollars for 3 years. My attorney had to go out of town so I am just wondering and I have questions. If it comes down to it, will I be given a choice to let her sell the home, get my 21,500 and walk away or will it automatically be turned into a chapter 13 if permitted by the court?

    #2
    This does happen all the time. The Trustee is right to question this especially where the equity and the exemption are close. The Trustee is also correct to address this when the source of the valuation is not well known. If you had an appraiser perform the valuation, the Trustee may have been more convinced. However, the Trustee was not convinced with your source for the valuation.

    So, the Trustee "might" send out someone to do a drive-by appraisal of the home.

    if the home appears to appraise higher, you and your attorney could decide to spend $250 and get a full appraisal (on a URAR) and use that to show the Trustee the real value. The Trustee still may not like that value, but they would also need an appraiser (not a drive-by, an actual full appraiser) to compete with your full appraisal. The Trustee may be disinclined to do their own appraisal because it would cost them $250, and if it appraises where the value puts it under the homestead exemption, the Trustee just lost at least $250.

    This is the negotiation game for Chapter 7s.

    As your attorney wrote, the worse case is that you could convert to a Chapter 13, where you would need to pay that difference (between the appraised value, your mortgage balance, and the homestead exemption) to the unsecured creditors over the life of your plan.

    A Chapter 13 is voluntary. You can always convert to the Chapter 13. You cannot be forced into a Chapter 13, and no one can file a Chapter 13 for you. it's entirely voluntary.


    Since you are represented by an attorney that is confident of the next steps, I ask that you lean on your attorney. They appear to know how Chapter 7 property valuation issues proceed in your district. Let's not get ahead of ourselves until the Trustee actually has a drive-by appraisal performed and questions your number formally. They only have 30 days to do so.
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog


    I am not an attorney. Any advice provided is not legal advice.

    Comment


      #3

      "A Chapter 13 is voluntary. You can always convert to the Chapter 13. You cannot be forced into a Chapter 13, and no one can file a Chapter 13 for you. it's entirely voluntary."

      So at that point if given the option, I could elect to go ahead with Chapter 7 and let the Trustee sell the house and walk away with my exemption amount after its all said and done?

      Thank you so much for the reply and information

      Comment


        #4
        Yes. You could decide to stay in the Chapter 7 and let the Chapter 7 Trustee liquidate the home. Your attorney, however, will try to convince the Trustee that liquidating is not worth the effort (due to the cost of the sale and that the Trustee would need to pay your homestead exemption).

        Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
        Status: (Auto) Discharged and Closed! 5/10
        Visit My BKForum Blog: justbroke's Blog


        I am not an attorney. Any advice provided is not legal advice.

        Comment


          #5
          Unfortunately this did happen to us as well when we originally filed chapter 7. We filed Oct. 2014 and it was discharged Feb 2015. Then all of a sudden in March 2015, the trustee informs our atty that she wants to sell our home. We had two (2) appraisals done showing there would not be enough equity, but she was convinced there was and wanted to proceed with a realtor selling it. Our atty quickly converted our case to chapter 13, paid at 100% for five years. We are currently awaiting discharge.
          Fortunately, you were alerted at your 341 hearing that your trustee planned on this. We had no clue! Wasn’t until a month after discharge she sprung this on us!

          Good luck to you, hope everything works out for the best!

          Comment


            #6
            Originally posted by Toolong View Post
            Unfortunately this did happen to us as well when we originally filed chapter 7. We filed Oct. 2014 and it was discharged Feb 2015. Then all of a sudden in March 2015, the trustee informs our atty that she wants to sell our home. We had two (2) appraisals done showing there would not be enough equity, but she was convinced there was and wanted to proceed with a realtor selling it. Our atty quickly converted our case to chapter 13, paid at 100% for five years. We are currently awaiting discharge.
            Fortunately, you were alerted at your 341 hearing that your trustee planned on this. We had no clue! Wasn’t until a month after discharge she sprung this on us!

            Good luck to you, hope everything works out for the best!
            My attorney has been working with the same Trustee for 19 years and I think it actually caught him off guard as well. Even though I was alerted yesterday that she was going to do this, she didnt ask me nor my attorney how we derived at our value at all. I cant really go into a Chapter 13. Im struggling enough as it is. I will elect for her to sell the home if she pursues this further. It will take a while to sell. Now I am just wondering how long I can live there if this happens.

            Comment


              #7
              Originally posted by justbroke View Post
              Yes. You could decide to stay in the Chapter 7 and let the Chapter 7 Trustee liquidate the home. Your attorney, however, will try to convince the Trustee that liquidating is not worth the effort (due to the cost of the sale and that the Trustee would need to pay your homestead exemption).
              Thank you. That is exactly what I will do. Honestly, if I were not under this circumstance and put the house up for sell myself, I dont think I would get as much as my exemption Im allowed.

              Comment


                #8
                Originally posted by ryano88 View Post
                Now I am just wondering how long I can live there if this happens.
                There's some lack of caselaw on this topic, but another BKforum member was asking about the Trustee charging them rent while they awaited the sale of the property. Some courts have concluded that the Trustee and the debtor are co-tenants, and the Trustee cannot charge rent. But there is no widespread consensus on this.

                Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
                Status: (Auto) Discharged and Closed! 5/10
                Visit My BKForum Blog: justbroke's Blog


                I am not an attorney. Any advice provided is not legal advice.

                Comment


                  #9
                  I suppose "no news is good news". On 6-20-19, according to PACER, it was entered on the docket that "Meeting of creditors was held and concluded on 6-17-19" and that is the last entry so far.

                  Comment

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