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Chapter 7 Trustee Forcing Short Sale
Since my practice was originally solely as a Chapter 11 attorney and most
of our time continues to be taken up by Chapter 11 cases, for years I have
been aware of and accepted as settled law the existence of this ability of
secured lenders to grant a carve-out for certain fees, usually for counsel
for the debtor and the creditors' committee. However, in all the 11s in
which I have been involved where the lenders have granted a carve-out
(i.e., business entity cases), you don't have to contend with exemptions.
It seems to me the ability of the individual debtors to avail themselves of
exemptions may enable a challenge to that "carve-out". It's an interesting
issue I hope I never have to deal with.
Since my practice was originally solely as a Chapter 11 attorney and most of our time continues to be taken up by Chapter 11 cases, for years I have been aware ofand accepted as settled law the existence of this ability of secured lenders to grant a carve-out for certain fees, usually for counsel for the debtor and the creditors' committee. have granted a carve-out (i.e., business entity cases), you don't have to contend with exemptions. It seems to me the ability of the individual debtors to avail themselves of exemptions may enable a challenge tothat "carve-out". It's an interesting issue I hope I never have to deal with.
The post was migrated from Yahoo.
OK so I just pulled the Higgins case 201 B.R. 965 (9th Cir. BAP 1996). It may not be as broad as I had hoped but I still think it works for the proposition that negative equity is exemptable. The source of that is actually the legislative history under section 522 cited by Judge Donovan in that BAP decision.
I have been assuming that Linda and other trustees that are employing this forced short sale with a carve out theory have been only going after property where the debtors are behind, in breach with the lender and "hoping" to get the fifth attempt at loan modification granted.
Is anyone aware of a case where a trustee is attempting a to force a short sale with carve out on a debtor who is NOT in breach with the lender? That would seem abjectly oppressive.
Still, Larry, I'm going to put you on the spot. What is the authority for the position that an agreement between the trustee and the creditor to modify the loan so that principal balance is reduced at sale to create equity in the property is not something that the debtor could then exempt?
Imagine this scenario. The debtor negotiates a short sale on his own and gets the creditor to agree to carve out $5000 from the sale for moving costs. HSBC has a judicial lien and won't consent to the sale. Why can't the debtor file chapter 7 list the short sale agreement as an asset, disclose the agreement he made with the bank and the $5000 he was promised, exempt it himself, move to avoid the HSBC lien under section 522(f) and get permission from the court to close the short sale or compel abandonment then close the short sale?
I think a debtor can ABSOLUTELY do that. Why is it different if it's just the trustee's post petition idea? There is a great deal of deference given to debtors to allow amendment to schedules any time during the case if done in good faith. If the debtor was unaware at filing of the secured creditor's willingness to modify the loan to accept a short payoff, I think its good faith to allow the debtor to exempt the carve out as soon as he becomes aware that it exists.
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
>
> I disagree. What's the authority for the position that the bank carve out isn't exemptable?
>
> I am at home and don't have the citation, but the case of In Re Higgins might help. In that case the issue was 11 U.S.C. section 522(f) and whether the debtor could claim an exemption in "negative equity" in the house to get a judicial lien avoided. The 9th Cir. (BAP I believe) said yes. I haven't read that case in a while but if memory serves me the court specifically said that the debtor's possessory interest has value, and that is exemptable.
>
> Same logic should apply. If you have exemptions available, amend C right away. Cite Higgins right on the schedule. Then watch what happens when the bank finds out they have to carve out for the trustee and the borrower's exemption. Most bankers would rather claw their eyes out with their fingernails than allow a short sale carve out of more than moving costs for the borrower, then pay for realtors and then pay some of the borrower's creditors. Plus if Linda gets fought and loses even one of these, it will very quickly become not cost efficient for her to do this with her new realtor best friends.
>
> Jeff Smith
>
> --- In cdcbaa@yahoogroups.com, Larry Simons wrote:
> >
> > But if the lenders are giving the trustee a carve out, those monies are not something that can be exempted. Essentially, the trustee is sharing the lien position with the lender giving the carve out. Secured liens are paid before exemptions. Exemptions protect equity in an asset.
> >
> > Sent from my iPad
> >
> > On Mar 10, 2013, at 6:43 PM, "Leventhal Law Group, P.C." wrote:
> >
> >
> >
> > Yes, because the Trustee could potentially hold the case open waiting for the property to increase in value.
> >
> >
> >
> > Jonathan Leventhal, Esq..
> > Leventhal Law Group, P.C.
> > 818-347-5800
> >
> > NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail notice for ex parte Applications via voicemail or by email. You must comply with California Law and give notice to a person in my office during regular business hours.
> >
> > This email and any attachments thereto may contain private, confidential, and privileged material for the sole use of the intended recipient. Any review, copying, or distribution of this email (or any attachments thereto) by others is strictly prohibited. If you are not the intended recipient, please contact the sender immediately and permanently delete the original and any copies of this email and any attachments thereto.
> >
> > Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
> >
> > Note: The Leventhal Law Group, P.C. does not represent you until a written fee agreement has been signed by you and a representative of the Leventhal Law Group, P.C. and all fees listed in the agreement have been paid.
> >
> > On Mar 10, 2013, at 6:31 PM, "Paul Horn" wrote:
> >
> >
> >
> > Can you exempt a primary resident is that negative equity?
> >
> >
> > Paul Horn
> > Attorney at Law
> > Certified Public Accountant
> > 850 E. Las Tunas Drive
> > San Gabriel, CA 91776
> > 800-380-7076
> >
> >
> > ________________________________
> > To: "cdcbaa@yahoogroups.com"
> > Sent: Sunday, March 10, 2013 5:04 PM
> > Subject: Re: [cdcbaa] Chapter 7 Tru stee Forcing Short Sale
> >
> >
> > Converting would assume their is some positive cash flow. Exemption and motion to abandon is really the best viable option in my opinion.
> >
> >
> >
> > Jonathan Leventhal, Esq..
> > Leventhal Law Group, P.C.
> > 818-347-5800
> >
> > NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail notice for ex parte Applications via voicemail or by email. You must comply with California Law and give notice to a person in my office during regular business hours.
> >
> > This email and any attachments thereto may contain private, confidential, and privileged material for the sole use of the intended recipient. Any review, copying, or distribution of this email (or any attachments thereto) by others is strictly prohibited. If you are not the intended recipient, please contact the sender immediately and permanently delete the original and any copies of this email and any attachments thereto.
> >
> > Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
> >
> > Note: The Leventhal Law Group, P.C. does not represent you until a written fee agreement has been signed by you and a representative of the Leventhal Law Group, P.C. and all fees listed in the agreement have been paid.
> >
> > On Mar 10, 2013, at 5:02 PM, "Clifford Bordeaux" wrote:
> >
> >
> > I would think that the judge would want to make sure that the debtor is prepared to pay creditors at least the amount of the proposed carve-out before letting the debtor convert. And if it is a WJ case, then conversion probably wouldn't be a viable option.
> >
> > On Sun, Mar 10, 2013 at 4:19 PM, Mark J. Markus wrote:
> > Apparently happening quite a bit now. There was a thread on this a couple weeks ago, so check the prior posts.
> >
> > Hasn't happened in one of my cases yet, but if client wants to keep the house, why not convert to Ch. 13 and do something like a $50 per month 36-month plan (assuming the Form 22C so allows and they don't have any priority debts that wouldn't be paid in full, although even then the creditor can agree to different treatment)?
> >
> > *************************
> > Mark J. Markus
> > Law Office of Mark J. Markus
> > 11684 Ventura Blvd. PMB #403
> > Studio City, CA 91604-2652
> > (818)509-1173 (818)509-1460 (fax)
> > web: http://www.bklaw.com/
> > Certified Bankruptcy Law Specialist--The State Bar of California Board of Legal Specialization
> >
> > This Firm is a Qualified Federal Debt Relief Agency (see what this means at http://www.bklaw.com/bankruptcy-blog/20 ... efinition/)
> > ________________________________________________
> > NOTICE: This Electronic Message contains information from the law office of Mark J. Markus that may be privileged. The information is intended for the use of the addressee only. If you are not the addressee, note that any disclosure, copy, distribution or use of the contents of this message is prohibited.
> > IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication.
> > On 3/10/2013 4:06 PM, Paul Horn wrote:
> >
> > Good Afternoon
> >
> > Lynda Bui, a Chapter 7 Trustee, is forcing my Chapter 7 client to short sale his house. Has anyone seen this and how to deal with it if
> >
> > debtor is applying for a loan modification to keep the house? There is absolutely no equity in the house.
> >
> > Thank You!!
> >
> > Paul Horn
> > Attorney at Law
> > Certified Public Accountant
> > 850 E. Las Tunas Drive
> > San Gabriel, CA 91776
> > 800-380-7076
> >
> >
> >
> >
> >
> > --
> > Clifford Bordeaux
> > Bordeaux Law, P.C.
> > 790 E. Colorado Boulevard, 9th Floor
> > Pasadena, CA 91101
> > T: 626-405-2345 / F: 626-4-628-1820 E: cliff@
> >
> >
>
The post was migrated from Yahoo.
thank you thank you thank you Jeff Smith... for showing us In re Higgins
201 BR 965, 967-968...
"Congress has made it clear in amending Section 522 that a lien will be
deemed to impair an exemption, even when there is no equity in the
property, if the sum of all the liens on the property and the hypothetical
value of the exemption without liens exceeds the value of the debtor's
interest in the property 968*968 in the absence of liens. Pursuant to the
plain language of the amended statute, the Debtors in this case are
entitled to avoid HFC's lien.
this is the link i have been missing in my theory to avoid foreclosure
sales by credit bid to undersecured creditors as fraudulent transfers.
On Tue, Mar 12, 2013 at 11:17 PM, jbsesq1965 wrote:
> **
>
>
> I disagree. What's the authority for the position that the bank carve out
> isn't exemptable?
>
> I am at home and don't have the citation, but the case of In Re Higgins
> might help. In that case the issue was 11 U.S.C. section 522(f) and whether
> the debtor could claim an exemption in "negative equity" in the house to
> get a judicial lien avoided. The 9th Cir. (BAP I believe) said yes. I
> haven't read that case in a while but if memory serves me the court
> specifically said that the debtor's possessory interest has value, and that
> is exemptable.
>
> Same logic should apply. If you have exemptions available, amend C right
> away. Cite Higgins right on the schedule. Then watch what happens when the
> bank finds out they have to carve out for the trustee and the borrower's
> exemption. Most bankers would rather claw their eyes out with their
> fingernails than allow a short sale carve out of more than moving costs for
> the borrower, then pay for realtors and then pay some of the borrower's
> creditors. Plus if Linda gets fought and loses even one of these, it will
> very quickly become not cost efficient for her to do this with her new
> realtor best friends.
>
> Jeff Smith
>
> --- In cdcbaa@yahoogroups.com, Larry Simons wrote:
> >
> > But if the lenders are giving the trustee a carve out, those monies are
> not something that can be exempted. Essentially, the trustee is sharing the
> lien position with the lender giving the carve out. Secured liens are paid
> before exemptions. Exemptions protect equity in an asset.
> >
> > Sent from my iPad
> >
> > On Mar 10, 2013, at 6:43 PM, "Leventhal Law Group, P.C." ...> wrote:
> >
> >
> >
> > Yes, because the Trustee could potentially hold the case open waiting
> for the property to increase in value.
> >
> >
> >
> > Jonathan Leventhal, Esq..
> > Leventhal Law Group, P.C.
> > 818-347-5800
> >
> > NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail
> notice for ex parte Applications via voicemail or by email. You must comply
> with California Law and give notice to a person in my office during regular
> business hours.
> >
> > This email and any attachments thereto may contain private,
> confidential, and privileged material for the sole use of the intended
> recipient. Any review, copying, or distribution of this email (or any
> attachments thereto) by others is strictly prohibited. If you are not the
> intended recipient, please contact the sender immediately and permanently
> delete the original and any copies of this email and any attachments
> thereto.
> >
> > Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
> >
> > Note: The Leventhal Law Group, P.C. does not represent you until a
> written fee agreement has been signed by you and a representative of the
> Leventhal Law Group, P.C. and all fees listed in the agreement have been
> paid.
> >
> > On Mar 10, 2013, at 6:31 PM, "Paul Horn" > wrote:
> >
> >
> >
> > Can you exempt a primary resident is that negative equity?
> >
> >
> > Paul Horn
> > Attorney at Law
> > Certified Public Accountant
> > 850 E. Las Tunas Drive
> > San Gabriel, CA 91776
> > 800-380-7076
> >
> >
> > ________________________________
> > To: "cdcbaa@yahoogroups.com cdcbaa@yahoogroups.com>
>
> > Sent: Sunday, March 10, 2013 5:04 PM
> > Subject: Re: [cdcbaa] Chapter 7 Tru stee Forcing Short Sale
> >
> >
> > Converting would assume their is some positive cash flow. Exemption and
> motion to abandon is really the best viable option in my opinion.
> >
> >
> >
> > Jonathan Leventhal, Esq..
> > Leventhal Law Group, P.C.
> > 818-347-5800
> >
> > NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail
> notice for ex parte Applications via voicemail or by email. You must comply
> with California Law and give notice to a person in my office during regular
> business hours.
> >
> > This email and any attachments thereto may contain private,
> confidential, and privileged material for the sole use of the intended
> recipient. Any review, copying, or distribution of this email (or any
> attachments thereto) by others is strictly prohibited. If you are not the
> intended recipient, please contact the sender immediately and permanently
> delete the original and any copies of this email and any attachments
> thereto.
> >
> > Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
> >
> > Note: The Leventhal Law Group, P.C. does not represent you until a
> written fee agreement has been signed by you and a representative of the
> Leventhal Law Group, P.C. and all fees listed in the agreement have been
> paid.
> >
> > On Mar 10, 2013, at 5:02 PM, "Clifford Bordeaux" > wrote:
> >
> >
> > I would think that the judge would want to make sure that the debtor is
> prepared to pay creditors at least the amount of the proposed carve-out
> before letting the debtor convert. And if it is a WJ case, then conversion
> probably wouldn't be a viable option.
> >
> > On Sun, Mar 10, 2013 at 4:19 PM, Mark J. Markus > wrote:
> > Apparently happening quite a bit now. There was a thread on this a
> couple weeks ago, so check the prior posts.
> >
> > Hasn't happened in one of my cases yet, but if client wants to keep the
> house, why not convert to Ch. 13 and do something like a $50 per month
> 36-month plan (assuming the Form 22C so allows and they don't have any
> priority debts that wouldn't be paid in full, although even then the
> creditor can agree to different treatment)?
> >
> > *************************
> > Mark J. Markus
> > Law Office of Mark J. Markus
> > 11684 Ventura Blvd. PMB #403
> > Studio City, CA 91604-2652
> > (818)509-1173 (818)509-1460 (fax)
> > web: http://www.bklaw.com/
> > Certified Bankruptcy Law Specialist--The State Bar of California Board
> of Legal Specialization
> >
> > This Firm is a Qualified Federal Debt Relief Agency (see what this means
> at
> http://www.bklaw.com/bankruptcy-blog/20 ... efinition/
> )
> > ________________________________________________
> > NOTICE: This Electronic Message contains information from the law office
> of Mark J. Markus that may be privileged. The information is intended for
> the use of the addressee only. If you are not the addressee, note that any
> disclosure, copy, distribution or use of the contents of this message is
> prohibited.
> > IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed
> by the IRS, we inform you that any U.S. tax advice contained in this
> communication (or in any attachment) is not intended or written to be used,
> and cannot be used, for the purpose of (i) avoiding penalties under the
> Internal Revenue Code or (ii) promoting, marketing or recommending to
> another party any transaction or matter addressed in this communication.
> > On 3/10/2013 4:06 PM, Paul Horn wrote:
> >
> > Good Afternoon
> >
> > Lynda Bui, a Chapter 7 Trustee, is forcing my Chapter 7 client to short
> sale his house. Has anyone seen this and how to deal with it if
> >
> > debtor is applying for a loan modification to keep the house? There is
> absolutely no equity in the house.
> >
> > Thank You!!
> >
> > Paul Horn
> > Attorney at Law
> > Certified Public Accountant
> > 850 E. Las Tunas Drive
> > San Gabriel, CA 91776
> > 800-380-7076
> >
> >
> >
> >
> >
> > --
> > Clifford Bordeaux
> > Bordeaux Law, P.C.
> > 790 E. Colorado Boulevard, 9th Floor
> > Pasadena, CA 91101
> > T: 626-405-2345 / F: 626-4-628-1820 E: cliff@...
> >
> >
>
>
>
thank you thank you thank you Jeff Smith... for showing us In re Higgins 201 BR 965, 967-968...
The post was migrated from Yahoo.
I disagree. What's the authority for the position that the bank carve out isn't exemptable?
I am at home and don't have the citation, but the case of In Re Higgins might help. In that case the issue was 11 U.S.C. section 522(f) and whether the debtor could claim an exemption in "negative equity" in the house to get a judicial lien avoided. The 9th Cir. (BAP I believe) said yes. I haven't read that case in a while but if memory serves me the court specifically said that the debtor's possessory interest has value, and that is exemptable.
Same logic should apply. If you have exemptions available, amend C right away. Cite Higgins right on the schedule. Then watch what happens when the bank finds out they have to carve out for the trustee and the borrower's exemption. Most bankers would rather claw their eyes out with their fingernails than allow a short sale carve out of more than moving costs for the borrower, then pay for realtors and then pay some of the borrower's creditors. Plus if Linda gets fought and loses even one of these, it will very quickly become not cost efficient for her to do this with her new realtor best friends.
Jeff Smith
>
> But if the lenders are giving the trustee a carve out, those monies are not something that can be exempted. Essentially, the trustee is sharing the lien position with the lender giving the carve out. Secured liens are paid before exemptions. Exemptions protect equity in an asset.
>
> Sent from my iPad
>
> On Mar 10, 2013, at 6:43 PM, "Leventhal Law Group, P.C." wrote:
>
>
>
> Yes, because the Trustee could potentially hold the case open waiting for the property to increase in value.
>
>
>
> Jonathan Leventhal, Esq..
> Leventhal Law Group, P.C.
> 818-347-5800
>
> NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail notice for ex parte Applications via voicemail or by email. You must comply with California Law and give notice to a person in my office during regular business hours.
>
> This email and any attachments thereto may contain private, confidential, and privileged material for the sole use of the intended recipient. Any review, copying, or distribution of this email (or any attachments thereto) by others is strictly prohibited. If you are not the intended recipient, please contact the sender immediately and permanently delete the original and any copies of this email and any attachments thereto.
>
> Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
>
> Note: The Leventhal Law Group, P.C. does not represent you until a written fee agreement has been signed by you and a representative of the Leventhal Law Group, P.C. and all fees listed in the agreement have been paid.
>
> On Mar 10, 2013, at 6:31 PM, "Paul Horn" wrote:
>
>
>
> Can you exempt a primary resident is that negative equity?
>
>
> Paul Horn
> Attorney at Law
> Certified Public Accountant
> 850 E. Las Tunas Drive
> San Gabriel, CA 91776
> 800-380-7076
>
>
> ________________________________
> To: "cdcbaa@yahoogroups.com"
> Sent: Sunday, March 10, 2013 5:04 PM
> Subject: Re: [cdcbaa] Chapter 7 Tru stee Forcing Short Sale
>
>
> Converting would assume their is some positive cash flow. Exemption and motion to abandon is really the best viable option in my opinion.
>
>
>
> Jonathan Leventhal, Esq..
> Leventhal Law Group, P.C.
> 818-347-5800
>
> NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail notice for ex parte Applications via voicemail or by email. You must comply with California Law and give notice to a person in my office during regular business hours.
>
> This email and any attachments thereto may contain private, confidential, and privileged material for the sole use of the intended recipient. Any review, copying, or distribution of this email (or any attachments thereto) by others is strictly prohibited. If you are not the intended recipient, please contact the sender immediately and permanently delete the original and any copies of this email and any attachments thereto.
>
> Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
>
> Note: The Leventhal Law Group, P.C. does not represent you until a written fee agreement has been signed by you and a representative of the Leventhal Law Group, P.C. and all fees listed in the agreement have been paid.
>
> On Mar 10, 2013, at 5:02 PM, "Clifford Bordeaux" wrote:
>
>
> I would think that the judge would want to make sure that the debtor is prepared to pay creditors at least the amount of the proposed carve-out before letting the debtor convert. And if it is a WJ case, then conversion probably wouldn't be a viable option.
>
> On Sun, Mar 10, 2013 at 4:19 PM, Mark J. Markus wrote:
> Apparently happening quite a bit now. There was a thread on this a couple weeks ago, so check the prior posts.
>
> Hasn't happened in one of my cases yet, but if client wants to keep the house, why not convert to Ch. 13 and do something like a $50 per month 36-month plan (assuming the Form 22C so allows and they don't have any priority debts that wouldn't be paid in full, although even then the creditor can agree to different treatment)?
>
> *************************
> Mark J. Markus
> Law Office of Mark J. Markus
> 11684 Ventura Blvd. PMB #403
> Studio City, CA 91604-2652
> (818)509-1173 (818)509-1460 (fax)
> web: http://www.bklaw.com/
> Certified Bankruptcy Law Specialist--The State Bar of California Board of Legal Specialization
>
> This Firm is a Qualified Federal Debt Relief Agency (see what this means at http://www.bklaw.com/bankruptcy-blog/20 ... efinition/)
> ________________________________________________
> NOTICE: This Electronic Message contains information from the law office of Mark J. Markus that may be privileged. The information is intended for the use of the addressee only. If you are not the addressee, note that any disclosure, copy, distribution or use of the contents of this message is prohibited.
> IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication.
> On 3/10/2013 4:06 PM, Paul Horn wrote:
>
> Good Afternoon
>
> Lynda Bui, a Chapter 7 Trustee, is forcing my Chapter 7 client to short sale his house. Has anyone seen this and how to deal with it if
>
> debtor is applying for a loan modification to keep the house? There is absolutely no equity in the house.
>
> Thank You!!
>
> Paul Horn
> Attorney at Law
> Certified Public Accountant
> 850 E. Las Tunas Drive
> San Gabriel, CA 91776
> 800-380-7076
>
>
>
>
>
> --
> Clifford Bordeaux
> Bordeaux Law, P.C.
> 790 E. Colorado Boulevard, 9th Floor
> Pasadena, CA 91101
> T: 626-405-2345 / F: 626-4-628-1820 E: cliff@...
>
>
The post was migrated from Yahoo.
This practice has been going on in Las Vegas for a couple of years. Overall the trustee's have not had too much success doing it - but they continue to try. When it first started, I began making sure to claim the homestead on negative equity property and indicated an intent to remain in the home (on the statement of intention I write "ride through and modify"). I never had another problem with a trustee attempting to short-sell the debtor's residence out from under him/her. I will argue to anyone that will listen that in a homestead situation, the carve out is not estate property unless the total net proceeds exceed the homestead allowance. Whether the debtor gains equity by the property value going up or the creditor reducing the payoff, it is still equity subject to the homestead allowance (in my humble estimation). To hold otherwise would mean that no exemptions are safe. Consider, a debtor with $15,000 equity in a home - not enough to cover the costs of sale, but within the homestead limit. Can the trustee work with the Lender on a carve out in this situation? Where does that line get drawn? And what about the public policy implications of forcing a debtor out of a home in the face of a declared homestead well within the homestead limit?
>
> Can you exempt a primary resident is that negative equity?
>
>
>
> Paul Horn
> Attorney at Law
> Certified Public Accountant
> 850 E. Las Tunas Drive
> San Gabriel, CA 91776
> 800-380-7076
>
>
>
>
> ________________________________
> To: "cdcbaa@yahoogroups.com"
> Sent: Sunday, March 10, 2013 5:04 PM
> Subject: Re: [cdcbaa] Chapter 7 Trustee Forcing Short Sale
>
>
>
> Converting would assume their is some positive cash flow. Exemption and motion to abandon is really the best viable option in my opinion.
>
>
>
>
> Jonathan Leventhal, Esq..
> Leventhal Law Group, P.C.
> 818-347-5800
>
> NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail notice for ex parte Applications via voicemail or by email. You must comply with California Law and give notice to a person in my office during regular business hours.
>
> This email and any attachments thereto may contain private, confidential, and privileged material for the sole use of the intended recipient. Any review, copying, or distribution of this email (or any attachments thereto) by others is strictly prohibited. If you are not the intended recipient, please contact the sender immediately and permanently delete the original and any copies of this email and any attachments thereto.
>
> Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
>
> Note: The Leventhal Law Group, P.C. does not represent you until a written fee agreement has been signed by you and a representative of the Leventhal Law Group, P.C. and all fees listed in the agreement have been paid.
>
> On Mar 10, 2013, at 5:02 PM, "Clifford Bordeaux" wrote:
>
>
>
> >I would think that the judge would want to make sure that the debtor is prepared to pay creditors at least the amount of the proposed carve-out before letting the debtor convert. And if it is a WJ case, then conversion probably wouldn't be a viable option.
> >
> >
> >On Sun, Mar 10, 2013 at 4:19 PM, Mark J. Markus wrote:
> >
> >Apparently happening quite a bit now. There was a thread on this a couple weeks ago, so check the prior posts.
> >>
> >>Hasn't happened in one of my cases yet, but if client wants to
> keep the house, why not convert to Ch. 13 and do something like
> a $50 per month 36-month plan (assuming the Form 22C so allows
> and they don't have any priority debts that wouldn't be paid in
> full, although even then the creditor can agree to different
> treatment)?
> >>
> >>
> >>*************************
> >>Mark J. Markus
> >>Law Office of Mark J. Markus
> >>11684 Ventura Blvd. PMB #403
> >>Studio City, CA 91604-2652
> >>(818)509-1173 (818)509-1460 (fax)
> >>web: http://www.bklaw.com/
> >>Certified Bankruptcy Law Specialist--The State Bar of
> California Board of Legal Specialization
> >>
> >>This Firm is a Qualified Federal Debt Relief Agency (see what
> this means at
> http://www.bklaw.com/bankruptcy-blog/20 ... efinition/)
> >>________________________________________________
> >>NOTICE: This Electronic Message contains information from the
> law office of Mark J. Markus that may be privileged. The
> information is intended for the use of the addressee only. If
> you are not the addressee, note that any disclosure, copy,
> distribution or use of the contents of this message is
> prohibited.
> >>IRS CIRCULAR 230 NOTICE: To ensure compliance with
> requirements imposed by the IRS, we inform you that any U.S.
> tax advice contained in this communication (or in any
> attachment) is not intended or written to be used, and cannot
> be used, for the purpose of (i) avoiding penalties under the
> Internal Revenue Code or (ii) promoting, marketing or
> recommending to another party any transaction or matter
> addressed in this communication.
> >>On 3/10/2013 4:06 PM, Paul Horn wrote:
> >>
> >>
> >>>
> >>>Good Afternoon
> >>>
> >>>
> >>>Lynda Bui, a Chapter 7 Trustee, is forcing my Chapter 7 client to short sale his house. Has anyone seen this and how to deal with it if
> >>>
> >>>
> >>>
> >>>debtor is applying for a loan modification to keep the house? There is absolutely no equity in the house.
> >>>
> >>>
> >>>
> >>>Thank You!!
> >>>
> >>>Paul Horn
> >>>Attorney at Law
> >>>Certified Public Accountant
> >>>850 E. Las Tunas Drive
> >>>San Gabriel, CA 91776
> >>>800-380-7076
> >>>
> >>>
> >>
> >
> >
> >--
> >Clifford Bordeaux
> >Bordeaux Law, P.C.
> >790 E. Colorado Boulevard, 9th Floor
> >Pasadena, CA 91101
> >T: 626-405-2345 / F: 626-4-628-1820 E:> >
> >
>
The post was migrated from Yahoo.
Can you exempt a primary resident is that negative equity?
Paul Horn
Attorney at Law
Certified Public Accountant
850 E. Las Tunas Drive
San Gabriel, CA 91776
800-380-7076
________________________________
To: "cdcbaa@yahoogroups.com"
Sent: Sunday, March 10, 2013 5:04 PM
Subject: Re: [cdcbaa] Chapter 7 Trustee Forcing Short Sale
Converting would assume their is some positive cash flow. Exemption and motion to abandon is really the best viable option in my opinion.
Jonathan Leventhal, Esq..
Leventhal Law Group, P.C.
818-347-5800
NO EX-PARTE NOTICE VIA VOICE MAIL OR EMAIL: I do not accept e-mail notice for ex parte Applications via voicemail or by email. You must comply with California Law and give notice to a person in my office during regular business hours.
This email and any attachments thereto may contain private, confidential, and privileged material for the sole use of the intended recipient. Any review, copying, or distribution of this email (or any attachments thereto) by others is strictly prohibited. If you are not the intended recipient, please contact the sender immediately and permanently delete the original and any copies of this email and any attachments thereto.
Leventhal Law Group, P.C. is a Debt Relief Agency under federal law.
Note: The Leventhal Law Group, P.C. does not represent you until a written fee agreement has been signed by you and a representative of the Leventhal Law Group, P.C. and all fees listed in the agreement have been paid.
On Mar 10, 2013, at 5:02 PM, "Clifford Bordeaux" wrote:
>I would think that the judge would want to make sure that the debtor is prepared to pay creditors at least the amount of the proposed carve-out before letting the debtor convert. And if it is a WJ case, then conversion probably wouldn't be a viable option.
>
>
>On Sun, Mar 10, 2013 at 4:19 PM, Mark J. Markus wrote:
>
>Apparently happening quite a bit now. There was a thread on this a couple weeks ago, so check the prior posts.
>>
>>Hasn't happened in one of my cases yet, but if client wants to
keep the house, why not convert to Ch. 13 and do something like
a $50 per month 36-month plan (assuming the Form 22C so allows
and they don't have any priority debts that wouldn't be paid in
full, although even then the creditor can agree to different
treatment)?
>>
>>
>>*************************
>>Mark J. Markus
>>Law Office of Mark J. Markus
>>11684 Ventura Blvd. PMB #403
>>Studio City, CA 91604-2652
>>(818)509-1173 (818)509-1460 (fax)
>>web: http://www.bklaw.com/
>>Certified Bankruptcy Law Specialist--The State Bar of
California Board of Legal Specialization
>>
>>This Firm is a Qualified Federal Debt Relief Agency (see what
this means at
The post was migrated from Yahoo.
I would think that the judge would want to make sure that the debtor is
prepared to pay creditors at least the amount of the proposed carve-out
before letting the debtor convert. And if it is a WJ case, then conversion
probably wouldn't be a viable option.
On Sun, Mar 10, 2013 at 4:19 PM, Mark J. Markus wrote:
> Apparently happening quite a bit now. There was a thread on this a
> couple weeks ago, so check the prior posts.
>
> Hasn't happened in one of my cases yet, but if client wants to keep the
> house, why not convert to Ch. 13 and do something like a $50 per month
> 36-month plan (assuming the Form 22C so allows and they don't have any
> priority debts that wouldn't be paid in full, although even then the
> creditor can agree to different treatment)?
>
> *************************
> Mark J. Markus
> Law Office of Mark J. Markus
> 11684 Ventura Blvd. PMB #403
> Studio City, CA 91604-2652
> (818)509-1173 (818)509-1460 (fax)
> web: http://www.bklaw.com/
> Certified Bankruptcy Law Specialist--The State Bar of California Board of
> Legal Specialization
>
> This Firm is a Qualified Federal Debt Relief Agency (see what this means
> at
> http://www.bklaw.com/bankruptcy-blog/20 ... efinition/
> )
> ________________________________________________
> NOTICE: This Electronic Message contains information from the law office
> of Mark J. Markus that may be privileged. The information is intended for
> the use of the addressee only. If you are not the addressee, note that any
> disclosure, copy, distribution or use of the contents of this message is
> prohibited.
> IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by
> the IRS, we inform you that any U.S. tax advice contained in this
> communication (or in any attachment) is not intended or written to be used,
> and cannot be used, for the purpose of (i) avoiding penalties under the
> Internal Revenue Code or (ii) promoting, marketing or recommending to
> another party any transaction or matter addressed in this communication.
> On 3/10/2013 4:06 PM, Paul Horn wrote:
>
>
> Good Afternoon
>
> Lynda Bui, a Chapter 7 Trustee, is forcing my Chapter 7 client to short
> sale his house. Has anyone seen this and how to deal with it if
>
> debtor is applying for a loan modification to keep the house? There is
> absolutely no equity in the house.
>
> Thank You!!
>
> Paul Horn
> Attorney at Law
> Certified Public Accountant
> 850 E. Las Tunas Drive
> San Gabriel, CA 91776
> 800-380-7076
>
>
>
Clifford Bordeaux
Bordeaux Law, P.C.
790 E. Colorado Boulevard, 9th Floor
Pasadena, CA 91101
T: 626-405-2345 / F: 626-4-628-1820 E: cliff@bordeauxlaw.com
I would think that the judge would want to make sure that the debtor is prepared to pay creditors at least the amount of the proposed carve-out before letting the debtor convert. And if it is a WJ case, then conversion probably wouldn't be a viable option.
On Sun, Mar 10, 2013 at 4:19 PM, Mark J. Markus <bklawr@yahoo.com> wrote:
The post was migrated from Yahoo.
Apparently happening quite a bit now. There was a thread on this a
couple weeks ago, so check the prior posts.
Hasn't happened in one of my cases yet, but if client wants to keep
the house, why not convert to Ch. 13 and do something like a $50 per
month 36-month plan (assuming the Form 22C so allows and they don't
have any priority debts that wouldn't be paid in full, although even
then the creditor can agree to different treatment)?
*************************
Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California
Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency (see what this
means at
The post was migrated from Yahoo.
Good Afternoon
Lynda Bui, a Chapter 7 Trustee, is forcing my Chapter 7 client
to short sale his house. Has anyone seen this and how to deal with it if
debtor
is applying for a loan modification to keep the house? There is absolutely no equity in the house.
Thank You!!
Paul Horn
Attorney at Law
Certified Public Accountant
850 E. Las Tunas Drive
San Gabriel, CA 91776
800-380-7076
The post was migrated from Yahoo.