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Can Chapter 13 Trustee hold Homestead Exemption Hostage in
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MAKING A WORLD OF DIFFERENCE SINCE 1970
Steve:
Not exactly, but I have an interesting similar case.
I have a Chapter 13 case (San Fernando Valley Division) that is still ongoing in which my client asserted her $175,000 homestead exemption. She fell behind again postpetition and therefore I encouraged her to sell her residence. We obtained Court permission to sell and she netted approximately $140,000. I urged my client to reinvest, but in large part because of her horrible physical condition, she was unable to do so. The Trustee then objected to the Debtor's plan on the ground that it proposed to pay creditors a significantly lower percentage than creditors would have received given that the exemptibility of the sale proceeds had expired. I then filed an amended Schedule C and asserted that the home was not only exempt as a homestead, but given that: 1) the Debtor was disabled well prior to her purchase of the home, 2) the Debtor purchased the home for $0 down, and 3) the Debtor's sole sources of income for the entire period after purchasing the home was exempt disability funds, the house was also exempt as disability benefits, and therefore so too were the proceeds. The Trustee objected to the amended exemptions, but the judge overruled the Trustee's objection, so the funds remain exempt.
Not exactly your fact pattern, but a great result in a challenging case.
Jeff
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The post was migrated from Yahoo.
For those with an extra moment on the Friday afternoon of 2018:
Has anyone successfully contested the Chapter 13 Trustee holding the homestead exemption hostage for the 6 months?
Case law from the days of Sam Bufford says the assets of the estate are no longer in contention post-confirmation.
My client is disabled and has a $175K homestead exemption which she would be entitled to, and she's moving to AZ after the sale. She'd like to use some of it as a cash reserve.
I've almost contested this in front of the same judge, but we elected to compromise with the Chapter 13 Trustee for some lesser amount of cash given the uncertainty of the ruling.
So again, Has anyone successfully contested the Chapter 13 Trustee holding the homestead exemption hostage for the 6 months?
Steve
Law Offices of Steven B. Lever
For those with an extra moment on the Friday afternoon of 2018:
Has anyone successfully contested the Chapter 13 Trustee holding the homestead exemption hostage for the 6 months?
Case law from the days of Sam Bufford says the assets of the estate are no longer in contention post-confirmation.
My client is disabled and has a $175K homestead exemption which she would be entitled to, and she’s moving to AZ after the sale. She’d like to use some of it as a cash
reserve.
I’ve almost contested this in front of the same judge, but we elected to compromise with the Chapter 13 Trustee for some lesser amount of cash given the uncertainty of the
ruling.
So again, Has anyone successfully contested the Chapter 13 Trustee holding the homestead exemption hostage for the 6 months?
Steve
Law Offices of Steven B. Lever
The post was migrated from Yahoo.