Trustee wants to sell my house

[sol1899]

I found out this morning that trustee valued my house 70,000 more than I did (so much for comps). He plans to sell my house but he has not yet filed the motions. My mortgage company filed a motion for relife of stay and "conspired" with trustee to continue untill 6/1/2006 so the trustee could file his paperwork and sell the house. The Judge has entered a tentative ruling to dismiss the motion for relife of stay but since the hearing is continued I think I am blocked from being able to do anything.

I finaly decided to break down and try to find a not so sleazy attorney to just review my case, and give me legal answers. Since my case is not easy money no attorney will call me back. I have offered to pay for consultation, I do not want an attorney to represent me, I do not expect anyone to take my case in the middle of my own mess. All I want is someone to translate legalease, and answer my legal questions, and maybe help me apply some precedence.

I only have 3 questions based on the 1st paragraph.

1. Is there any thing I can do to stop the sale and keep my house?

2. can file a motion for voluntary dismissal with a bar? I know that I cannot without a bar.

3. can I motion to convert my case back to a 13 now that I can afford the plan payments and more?

I'd really appreciate any information that anyone might be able to me. I've never had migrains but reading the codes makes my head feel like it's going to explode!

[aa06a47]

I think you can convert to a chapter 13. I think a lawyer will take your case. I just think that most BK lawyers are getting extremely busy again.

[time4cake]

Were you wrong about the value of your house?

It seems unlikely that the trustee would want to sell your house if truly did not have value in it. Did you under estimate the value of your home?

It is a rather large risk for the trustee to attempt to sell your home. First, from my understanding they have to pay directly to you the amount you claimed as exemption on your house. He also has to pay all the closing costs and legal fees associated with selling the house as well as any real estate comission if any.

For him to believe that the house is actually worth $70,000 more than you reported must mean something. How did he arrive at this figure?

If it is only worth what you reported you should be happy to pocket the exemption portion in cash and walk away. If its worth what he thinks it is worth and you knew it was worth more than you reported you should be reasonably satisfied that you aren't getting your case dismissed for fraud.

I know that sounds harsh, and that wasn't my intent. I could be way off on this, and I apologize if I am.

Good luck with your situation.

[Minnymouth]

Had you been in a Chapter 13 to begin with and then converted to Chapter 7..... and now you want to go back to 13??? Sounds that way...... update me!

The only way I see you getting your home back is you buying it outright back from the Trustee.

For the Trustee to seize your home you must have a great deal of equity in it or the mortgage paperwork is not "perfected"....

Usually in a bankruptcy ir you are not keeping your home, can't pay for it, it is surrendered back to the mortgage company to cover the debt.

By the mortgage company working with the Trustee tells me that you have a lot of equity, the house will be sold, mortgage company will get their share (deal with trustee) and the rest will be divided among your secured creditors.

A consultation with an attorney will help you to understand what has happened and what will happen.

I am assuming you filed pro se??? Sometimes a bad mistake...

You may be past the point of "no-return" on the house issue since it has gone this far already....

Keep us posted,

[Minnymouth]

Lots of people hire attorneys who are also Trustees..... there are many of them.....
When they are not working as Trustees they have their own private practice to consider.

[sol1899]

Thanks for your responses.
I did originally file chapter 13,the bank got a releif of stay which I did not oppose because I wanted a forbearance. I got my forbearance and then converted to chapter 7 beliving that it would not effect the relief of stay, and that I would be able get my unsecured debt discharged, but it did impose a new stay.

I valued my house at 240,000 using the county tax assesors website back in june of '04. The trustee valued it at 310,000 in january '06. I wish they would dismiss for fraud and if they prosecuted, my defense is that I valued my house 18 months ago and values have risen.

From what I understand of code I moght be able to motion for conversion back to a 13 or a dismissal but have to have very good reasons for doing so and prepare all my forms to the tee. I found an opinion by a judge in another state that outlines his reasons for denying a debtor's motion to dismiss which will be very helpful in writing my motion.

If the sale does go through, would the trustee only pay secured and priority claims or would he pay all of my creditors even though they did not file a proof of claim?

[Minnymouth]

Trustee will pay priority creditors, then secured creditors, then unsecured that filed a claim......

Sounds like you need an attorney on your side now.....

Keep us posted.

[SinkingFast]

It seems unlikely that the trustee would want to sell your house if truly did not have value in it. Did you under estimate the value of your home?

It is a rather large risk for the trustee to attempt to sell your home. First, from my understanding they have to pay directly to you the amount you claimed as exemption on your house. He also has to pay all the closing costs and legal fees associated with selling the house as well as any real estate comission if any.

For him to believe that the house is actually worth $70,000 more than you reported must mean something. How did he arrive at this figure?

If it is only worth what you reported you should be happy to pocket the exemption portion in cash and walk away. If its worth what he thinks it is worth and you knew it was worth more than you reported you should be reasonably satisfied that you aren't getting your case dismissed for fraud.

I know that sounds harsh, and that wasn't my intent. I could be way off on this, and I apologize if I am.

Good luck with your situation.

Everything Time said is correct.

Typically Trustees don't mess with houses unless they are fairly certain of their ground on the value of the property and what they think they'll actually get. House sales are cumbersome and costly. Even at a $70K difference of opinion, you must have some equity built up or the Trustee wouldn't even be going for your house.

#1,......... On average, it costs a Trustee 10% of the sale price to sell a house. On a $300K house, that's roughly $30K there.
#2,......... The Trustee isn't gonna wait around for a "best price" offer. It will be quick sale price at best.
#3,......... The Trustee will have to pay you your Homestead exemption amount right off the top.

I think about the only way this would be at all attractive to the Trustee is if you have quite a bit more equity than you could exempt.

[sol1899]

Thanks agian,
Bankruptcy lawyers don't seem to be the type who really enjoy a challenge or even enjoy their job. The ones I've called seem to be nothing more than trying to get people to file. I called a referal service and asked for someone who likes a challenge, no luck. The ones I've seen in court have been ditzy girls who make whiny arguments trying to justify why they are late for a hearing and pissing off the judge. Others work independantly for firms that sold the debtor into filing bankruptcy and are just there to make an appearance. The only decent ones I've come across work for creditors.

Don't the costs for the trustee selling the home come out of the equity? and if so what is the risk to the trustee?

[SinkingFast]

Thanks agian,
Bankruptcy lawyers don't seem to be the type who really enjoy a challenge or even enjoy their job. The ones I've called seem to be nothing more than trying to get people to file. I called a referal service and asked for someone who likes a challenge, no luck. The ones I've seen in court have been ditzy girls who make whiny arguments trying to justify why they are late for a hearing and pissing off the judge. Others work independantly for firms that sold the debtor into filing bankruptcy and are just there to make an appearance. The only decent ones I've come across work for creditors.

Don't the costs for the trustee selling the home come out of the equity? and if so what is the risk to the trustee?

We had 10 Consults. Out of the 10, we saw 2 decent attnys. One wouldn't take us because she didn't wanna deal with outa state exemptions. The other one is charging us a premium to handle our case. So I hear you loud and clear there. I know it's exhausting, but make Consult appointments. Go and chat. Listen to what they have to say. Go home and think about your visit. If you like one, call them back for follow-up questions. See how you get treated then. Stay in the hunt until you find someone you can work with.

About the sale of the house,..................

The money goes like this,.................

On average, it costs 10% for a Trustee to sell a house. Costs to sell come off the top before anyone else get's paid. Possibly included in the costs to sell may be an attny's fee for representation of the Trustee. Since Trustees are usually lawyers, Trustees usually hire themselves to represent themselves.

You receive your exemption allowed amount and the Trustee will pay the note on the house if you have a mortgage.

The Trustee get's paid their percentage based on the gross proceeds of the sale. If the Trustee was the attny representing the Trustee, the Trustee gets to double dip.

Priority Creditors get paid next. IRS, child support, etc.

Secured Creditors, if any, like a car loan you BK'd on.

Unsecureds are DEAD last. If anything is left.

[sol1899]

Just a quick update.
I prepared and filed my 28 page motion to dismiss my chapter 7 today. Thank you for the info you provided, and thanks to pacer, the court's website, and to Al Gore for the internet. I just hope this works.

[sol1899]

Well, my hearing to get my case dismissed is tomorrow. Of course the trustee filed his 10 page objection, and I, in turn, filed an 8 page reply. I never did find an attorney that wanted to break a sweat. Any attorney I talked to just said that I could not even file for a dismissal. Well, I did, and the court is going to hear it. My theory, aside from just wanting the open and close type of work, is that attorneys are arfraid to piss off a trustee, If an attorney were to succeed in getting a dismissal for his client, the trustee and his realestate broker golf buddies would not be able to cash out on the equity of an estate. Then the trustee would put the one attorney, who actually worked hard for the best interest of his client, on his s--- list.

[lilgoose]

I wish you the best of luck!

I can't believe that a judge and/or trustee would not want someone to dismiss their case. What is wrong with this picture? It seems as though they are saying that they want you to fail instead of that you CAN and are willing to take care of your debt and get out of the system.....

Oh, our wonderful gov't is so messed up and the priorities are so screwed up!

[SinkingFast]

Good Luck tomorrow, Sol!! We'll be praying for you that all goes well.

Lil,..........

BK Lawyers, Trustees, and Judges are a close knit group. It's like a fraternity or sorority, or an exclusive club with limited membership. They all know each other, know who's respected and who isn't, who's a flake and who isn't. That kind of thing.

We hired one attny first. He never did a thing. Was driving me crazy. Hubby kept saying he knew his date and they all probably did that. Waited up until the last minute to do anything. When the date came and went and he still didn't do anything, Hubby agreed that we needed a different attny. In calling around to the attnys that were left, when I mentioned we'd originally tried to work with this guy to offer a DIL but he didn't do a thing, they all said, "He's notorious for that. He drops the ball, a lot."

We had several interesting short chats with other attnys about the one that talks like Porky the Pig. He comes off as a total doof. The attny assured us not to let that fool us. He's really very crafty in his own sort of way. YUP. Crafty at cheating his clients. Pushing everyone into a 13 that he possibly can. I couldn't even begin to imagine having to work with that guy thru ammends and changes to my plan over the course of 5 years. It sent shudders down my spine.

[Minnymouth]

Trustees MAKE NO MONEY when a case is dismissed............. He wants his bread and butter and lots of it..........

Hope this works for you........... I can truly understand where your coming from..............

GO FOR IT,

MINNY