Collect Rent after file Chapter 7?

[awayalways]

OP my attorney added my rental income to the current income schedule. Then he listed my current mortgage under expenses because these were the amounts due on the day I filed (I dont remember the forms). But then he also added $1200 to my projected expenses for housing because I was surrendering my home in bankruptcy (you have to live somewhere). But remember surrendering your home in bankruptcy doesnt change the fact that you are still the owner of the property until it forecloses and entitled to rent payments.

Also the Obama 90 day tenant law for renters only applies to Federally backed loans *sigh*.

[brandon94]

awayalways,

Did you report the rental income on your schedule I as current or projected monthly income. I know you mentioned you reported it for the means test.

Thanks

[shabam]

Since you are handing it back, I would tell the renter you are filing and stop taking any more rent from them. The lease could very well be null and void when you file, so why complicate things for a few extra $$$$. You would not want the tenant to file an AP or get the UST involved.

[shabam]

Yes I am.

Does your rental contract have a bk clause?

[awayalways]

OP I defaulted on my FL pre-foreclosure in Dec 2006 so thats about 35 months or so now. I made the lender produce the note and jump through a few other hoops too. So maybe this is part of the reason. Anyways my f/c is on a 750k property so I really dont know why their not moving on it.

If I were in your shoes, I would file a few days before the f/c hearing. Then bring a copy of the notice of stay down to your circuit court county clerks office and have them time stamp it and file it with your f/c docket. This will close your forclosure for a while because they will have to either lift the stay (about 6 weeks) or wait until your discharged (about 12 weeks) then reopen your case (about 3-4 weeks) file motion for summary judgement (about 3-4 weeks) advertise for sale of property (about 3-4 weeks). Plus, if you can find something wrong with your mortgage, you could probably get some more time by raising questions in the foreclosure summons. Just because you surrendered your property does not mean that any ol lender can come in and foreclose on you. Everytime they have to answer adds time. And you can do whatever you want with your house while the home is in your name.

Hope it all works out for you. aa.

[brandon94]

awayalways,

So they still haven't foreclosed and sold the property at auction in all that time? I just received a motion for final judgement of foreclosure from the lenders attorney. There is no hearing date scheduled yet. I will be filing chapter 7 next week. Do you have any idea how long things will be delayed for my property in Florida before they finally get to auction it off?

This whole thing is confusing to me because I had one attorney I consulted with say that once you file chapter 7 and surrender the property then its not your property and you cannot collect any rent. I had 2 other attorneys say that you probably could keep it.

Did you list your anticipated rental income on the schedule J. I would think it would be hard to list that since you don't have any idea how much longer you can collect it. The renter could stop paying or the place could get auctioned off quickly.

Thanks,

Brandon

[awayalways]

So did you collect rent after you filed even though you were giving the property up? Did the trustee ask anything about that in the 341?

Thanks

Yes, I am still collecting rent and the debt is reporting IIB. I was discharged 04/08. No problem at the 341. Even with the rental income, I passed the means test.

[brandon94]

So did you collect rent after you filed even though you were giving the property up? Did the trustee ask anything about that in the 341?

Thanks

[awayalways]

Hub said it better than I could have. But just to tell the OP, I am in the same position having a Florida rental before, during and after my BK7. I have had no problems and this has been going on for several years now.

[AngelinaCatHub]

Yes you have a point. Put the rental down as income. If it is not exempted, it become part of the estate. The deposit is also part of the estate. I cannot see how you can file against the renters. In reality the deposit BELONGS to the renter. I would do this to simplify the situation. Forgive two months of rent to the renters and tell them that is payment of their deposit. They may not understand but that may set off questions and they just may never pay rent again. Remember you cannot sue anyone while in your stay. You won't have grounds to sue them after the house is foreclosed. Perhaps they are good enough renters that your "benevolence" and for Christmas makes you feel generous. Well that's a little white lie, but I'm sure you will figure a way.

Here's another, you might consider a rent reduction and tell the renters their deposit will be the reduction in rent. If they get their deposit back, you would not need to include it as an asset in your forms.

If you are represented, you should ask your lawyer on this one. It is touchy. 'Hub

[brandon94]

Hub,

I am going to file late next week after collecting the November rent. Will the trustee have a problem with me collecting rent after I file. Won't they try to get the money if they catch wind of it? I also collected a security deposit from the renter in which I don't have the money anymore. Some people recommend putting the renter in the petition as a creditor for the deposit. If I do that however I assure myself of not collecting any more rent from that person and alert them of the bankruptcy and foreclosure.

These days in Florida properties are sitting there for along time without being foreclosed and after that with the new Obama tenant law the renter gets 90 days to vacate. Because of that I am very confident my renter would be able to stay there for at least 6 more months.

[AngelinaCatHub]

Ok thanks, I was just wondering. Alright, back to the thread for any more comments/feedback to the OP.

You have not hijacked a thread when you ask a question that both answers your question (just as important as the Op's) and it also compliments the vein of the thread.

At times, I have thrown some joking words off subject, just to lighten up the Op's mood (as intended anyway). As long as the thread doesn't just go to pieces, I see nothing wrong with it. 'Hub

[ForumReader]

OH is exactly correct. Your renter is purchasing goods or services from you (the apartment). You in good faith are still compelled by taking his monies, to make the normal repairs for the benefit of the renter. The renter has business with you, the owner. The mortgage is a separate issue. the day you signed to purchase that house, you owned it 100%. The mortgage is ancillary only as a lien against the property. They must sue you for breach of your mortgage then the Court awards them the "damage" in the form of the secured (liened) property. 'Hub

Ok thanks, I was just wondering. Alright, back to the thread for any more comments/feedback to the OP.

[AngelinaCatHub]

I do not mean to hijack the thread, but I am curious (I am a renter), is it ethical to collect rent from a tenant when the owner has stopped paying mortgage payments on the property (being in a foreclosure process)?

OH is exactly correct. Your renter is purchasing goods or services from you (the apartment). You in good faith are still compelled by taking his monies, to make the normal repairs for the benefit of the renter. The renter has business with you, the owner. The mortgage is a separate issue. the day you signed to purchase that house, you owned it 100%. The mortgage is ancillary only as a lien against the property. They must sue you for breach of your mortgage then the Court awards them the "damage" in the form of the secured (liened) property. 'Hub

[OhioFiler]

I do not mean to hijack the thread, but I am curious (I am a renter), is it ethical to collect rent from a tenant when the owner has stopped paying mortgage payments on the property (being in a foreclosure process)?

Of course it's ethical. The tenant isn't filing BK. The tenant didn't insist on a clause in the lease that allows for the non-payment of rent in the event the lessor fails to make mortgage payments.

There is no relationship between a renter's obligation to pay rent and the landlord's finances.