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Left out key fact!
Left out key fact which can be inferred. Prior to filing, Debtor transfers his 50% interest to the other obligor, but remains on the loan.
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> This comes up fairly frequently, and since it usually has no impact either way, its perhaps meaningless, but I was discussing this with another bk attorney (not on this listserve)
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> Debtor has a 50% interest in a car with a non-filing friend (or it could a house, jewelry, etc.). The car was collateral for the debt. The car is way upside down - no equity whatsoever. However, Debtor still remains liable on the loan.
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> List the debt in Schedule D or Schedule F? If you list in Schedule D, makes sense in that the debt is still secured, but its not secured by property of the Debtor. Moreover, then you're listing the collateral in Schedule B, which instructs us to list Debtor's interest in the property, which he no longer has. You're also then doing the Statement of Intent, etc. I usually do it this way anyway, with a detailed explanation of the whole thing in Schedule B and D, as well as the obligatory Item 10 of SOFA.
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> However, Buddy of mine says if Debtor has no interest in the property, the debt is no longer secured as to him, and so just list it in Schedule F, and be done with it. Certainly easier, but it seems to leave out important info, even though the transfer is listed in Item 10 of SOFA.
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> Putting aside preference issues (there is no transfer of any value), which is the better approach? Or, given the fact that the property transferred was drastically upside down, is it of no significance one way or another?
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> Todd Mannis, Esq.
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The post was migrated from Yahoo.