Central District Consumer Bankruptcy Attorney's Association

*Has anyone seen this ruling ? Homestead exemption ruled as belonging to
the bankruptcy estate because it was not reinvested in a homestead within 6
months. *
*The reinvestment period under the California homestead exemption lasts*
*six months regardless of when a debtor sells his homestead.*
*Lane theorized that if the proceeds from post-petition homestead*
*sales could lose their exempt status, trustees might*
*claim an interest in the homestead and postpone closing a*
*case so long as there is any possibility the debtors circumstances*
*might change. Id. at 765. We find this concern too*
*speculative. We doubt a trustee would delay liquidating an*
*estate because (1) the debtors homestead might be sold at*
*some point in the future and (2) the debtor might fail to reinvest*
*his share of the proceeds six months after the sale.*
*
*
*The reasoning is flawed for at least two reasons:*
*1] Trustees will most likely delay closing of cases because they've done
it before capture the growth in equity unless a motion to abandon is filed
and granted;*
*2] Since when can a debtor in Los Angeles County buy another home for
$75,000 / $100,000 / $175,000 ? No bank is going to give them a loan
during bankruptcy or shortly thereafter thereby requiring them to buy one
for cash.*
* *
* *
_________________________
Robert K. Lee, Esq
State Bar Certified Specialist
[Bankruptcy Law]
3435 Wilshire Blvd, Suite 1035
Los Angeles, CA 90010
Ph [888] 777-0839 Ext 505
Fax [888] 777-0849
WEBSITE
Has anyone seen this ruling ? Homestead exemption ruled as belonging to the bankruptcy estate because it was not reinvested in a homestead within 6 months.
The reinvestmentperiod under the California homestead exemption lastssix months regardless of when a debtor sells his homestead.
Lane theorized that if the proceeds from post-petition homesteadsales could lose their exempt status, trustees mightclaim an interest in the homestead and postpone closing a
case so long as there is any possibility the debtors circumstancesmight change. Id. at 765. We find this concern toospeculative. We doubt a trustee would delay liquidating an
estate because (1) the debtors homestead might be sold atsome point in the future and (2) the debtor might fail to reinvest
his share of the proceeds six months after the s
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