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Never Heard This One Before
charsetndows-1252
So, i guess the debtor hasn't claimed any homestead exemption, and used up all his wildcard on his string of racing ponies. An exemption on the property would certainly quiet down the trustee.
You can bet there is a hungry real estate broker driving this one.
Jason
Jason Wallach
jwallach@gladstonemichel.com
On Nov 28, 2012, at 5:51 PM, Stella Havkin wrote:
>
> It is going on right now. Lindas firm is doing it for Sam Leslie on a rental property of my debtors that is over $1,500,000 upside down. I do not know if they will be successful.
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> Stella Havkin
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> Certified Bankruptcy Law Specialist The State Bar of California Board of Legal Specialization
> Certified Consumer Bankruptcy Law Specialist The American Board of Certification
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>
jbsesq1965
> Sent: Wednesday, November 28, 2012 5:39 PM
> To: cdcbaa@yahoogroups.com
> Subject: [cdcbaa] Never Heard This One Before
>
>
>
>
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> 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 payments 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 work 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.
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> 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?
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> 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
>
>
>
>
charsetndows-1252
So, i guess the debtor hasn't claimed any homestead exemption, and used up all his wildcard on his string of racing ponies. An exemption on the property would certainly quiet down the trustee. You can bet there is a hungry real estate broker driving this one.Jason
Jason Wallach
The post was migrated from Yahoo.
It is going on right now. Linda's firm is doing it for Sam Leslie on a
rental property of my debtor's that is over $1,500,000 upside down. I do
not know if they will be successful.
Stella Havkin
cid:part1.09090707.02070109@yahoo.com
Certified Bankruptcy Law Specialist - The State Bar of California Board of
Legal Specialization
Certified Consumer Bankruptcy Law Specialist - The American Board of
Certification
The post was migrated from Yahoo.
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 payments 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 work 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
The post was migrated from Yahoo.