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Never Heard This One Before PC calls for a second opini=
Hi Guys,
I've run into this before 2x. Can't talk online about it though. Contact me direct if you want my input.
Sincerely,
Tyson M. Takeuchi, Esq.
Tyson M. Takeuchi
Certified
Bankruptcy Specialist*^
Law Offices of Tyson M. Takeuchi
1100
Wilshire Blvd., Ste. 2606
Los Angeles, CA 90017
tel: (213)
637-1566
fax: (888) 977-6310
*By State Bar of California Board of
Legal Specialization
^Consumer Bankruptcy Specialist Certified by
American Board of Certification
To: cdcbaa@yahoogroups.com
Date: Wed, 28 Nov 2012 19:33:08 -0800
Subject: Re: [cdcbaa] Never Heard This One Before
As I understand it, this is prevalent in Las Vegas. Sam, perhaps you have some insight ?
Sent from my iPhoneLaw Office of Eric Alan Mitnick (310) 792-5864 MitnickLaw@aol.comCommunications and attachments may be confidential and attorney-client privileged.
On Nov 28, 2012, at 7:04 PM, "Steven B. Lever" wrote:
Jeff; First, thanks for sharing this horror story. If Stephen King were a bankruptcy trustee he couldnt do better to put a chill in debtors and their attorneys. Perhaps we need a Tara Toomey like effort for motion to abandon, creating our own form with P&As and just fill in the blanks and hit her with said motions every time, thereby increasing the cost of this overreaching transaction that will stress the hell out of our clients. Of course, the quality
of the P&A which depends on whether the law allows Trustees to take such speculative actions that depend on the kindness of secured creditors and the craziness and hunger of realtors. Ive no idea if this is part of the business judgment rule or not, but it sure seems like a stretch to me. Stevecom] On Behalf Of jbsesq1965
Sent: Wednesday, November 28, 2012
5:39 PM
To: cdcbaa@yahoogroups.com
Subject: [cdcbaa] Never Heard This One Before PC calls for a second opinion on a matter. He is in Chapter 7 in RS, judge is MW and Chapter 7 Trustee is Linda Bui.
He has a house that is underwater with a first and second mortgage. At filing he is 5 payments down to CitiMortgage, he is NOT in foreclosure, and they are accepting payments for the last 6 months so he isn't getting further behind. Moreover, Citi offered him a possible modification (in writing) under the NMS program which he is actively pursing and Citi even sent him a "pre-approval" letter that says as long as he gets the usual list of docs into them, they will modify the mortgage and reduce the principal to Current Market Value and capitalize the arrears so he's not 5 payme
nts down anymore. Citi has NOT asked for relief from stay.
At the 341(a) last month Linda Bui makes a demand that he provide proof that he is "modifing" and asks that he keep her apprised of the modification efforts. When PC's current lawyer asks Linda why this is necessary, she says that if he doesn't modify the loan, she intends to sell the house in a "short sale" and ask Citi and the second lender for a "carve out" to pay unsecured creditors.
I have never heard of such a thing! Maybe if Linda is convinced the debtor is serious about modification she will back down, but thinking this through there seems to be something wrong about a trustee listing the property for sale under 363 in the hopes that she can get a short sale negotiator to carve out a few bucks for the estate, when the debtor is not in foreclosure, the property is upside down and the debtor is no where near at the end of his proverbial rope in terms of options to w
ork it out with Citi. Assume the debtor has used all available exemptions on other stuff so he can't dissuade Linda by amending C to exempt her potential/theoretical carve out.
There is a part of me that says this is outrageous. There is another part of me that says if an enterprising trustee finds a unique way to generate funds for the estate, what is to stop her?
Anyway I'd love to hear what the group says and just wanted this posted as a possible warning of yet one more thing we practitioners may have to warn our clients about in the right circumstances.
BTW-My advice was that if trustee won't back down after an exchange of e-mails, and information about the seriousness of the loan modification: Motion to Compel Abandonment of the house. It has no equity and the trustee's suggestion that she "might" squeezee a few bucks out in a short sale is pure speculation.
Jeffrey B. Smith**
CURD, GALINDO & SMITH, L.L.P.
301 East Ocean
Blvd. #1700
Long Beach, CA 90802
(562) 624-1177
(562) 624-1178 fax
(310) 993-6560 cellular
www.expertbk.com
**Certified By The State Bar
Of California As A Specialist
In Bankruptcy Law
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