Central District Consumer Bankruptcy Attorney's Association

Interesting opinion from last month
On Fri, Mar 15, 2013 at 9:47 AM, Wesley H. Avery wrote:
> **
>
>
> Touch.****
>
> ** **
>
> ** **
>
> *Wesley H. Avery**
> Wesley H. Avery, Esq.
> Roquemore, Pringle & Moore, Inc.*
> *6055 E. Washington Blvd., Ste. 500*
> *Los Angeles, CA 90040-2466*
> *wavery@rpmlaw.com*
> *http://www.rpmlaw.com*
> *(323) 724-3117 (office)*
> *(323) 724-5410 (fax)* **
>
> *Law Offices of Wesley H. Avery, APC
> 28005 Smyth Drive, Ste. 125
> Valencia, CA 91355-4023
> wavery@thebankruptcylawcenter.com
> http://www.thebankruptcylawcenter.com
> (661) 295-4673 (direct)
> (661) 295-4674 (office)
> (661) 430-5467 (fax)
> (661) 618-7376 (cell) *
>
> [image: cid:part1.03050307.05030101@bklaw.com]
> *
> Certified Specialist*
> *Bankruptcy Law*
> *State Bar of California
>
> Board Certified*
> *Business Bankruptcy Law*
> *American Board of Certification* ****
>
> CONFIDENTIALITY NOTICE: The information contained in this e-mail
> transmission is intended only for use of the individual or entity named
> above. This e-mail transmission , and any documents, files, previous
> e-mail transmissions or other information attached to it, may contain
> confidential information that is legally privileged. If you are not the
> intended recipient of this e-mail transmission, or the employee or agent
> responsible for delivering it to the intended recipient, you are hereby
> notified that any disclosure, dissemination, copying, or other use of this
> transmission or any of the information contained in or attached to it is
> strictly prohibited. If you have received this e-mail transmission in
> error, please immediately notify us by return e-mail transmission or by
> telephone at (661) 618-7376, and destroy the original e-mail transmission
> and its attachments without reading it or saving it in any manner. Thank
> you.****
>
> ** **
>
> ****
>
> ** **
>
> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com] *On Behalf
> Of *Jeffrey S. Shinbrot
> *Sent:* Friday, March 15, 2013 9:35 AM
> *To:* cdcbaa@yahoogroups.com
> *Subject:* RE: [cdcbaa] Re: Chapter 7 Trustee Forcing Short Sale****
>
> ** **
>
> ****
>
> If we are talking about a homestead property, whether behind on the
> mortgage or not, it constitutes a forced sale by a trustee ((In re Cole, 93
> B.R. 707 (9th Cir BAP 1988)) and I would argue that that the homestead
> trumps I am interested in the appeal (really on either side but Id
> rather have the debtor in this one, especially if I get to take Wes to
> breakfast in Pasadena after oral argument). ****
>
> ****
>
> ****
>
> ****
>
> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com]
> *On Behalf Of *Leventhal Law Group, P.C.
> *Sent:* Friday, March 15, 2013 8:45 AM
> *To:* cdcbaa@yahoogroups.com
> *Subject:* Re: [cdcbaa] Re: Chapter 7 Trustee Forcing Short Sale****
>
> ****
>
>
>
>
>
> ****
>
> Is their any statistics as to wether this is happening when the Debtors
> are current with the mortgage payments or behind in payments, or.....?****
>
> ****
>
> ****
>
> 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 ther eto.****
>
> ****
>
> 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 15, 2013, at 6:25 AM, "Catherine Christiansen" christiansenlaw@yahoo.com> wrote:****
>
> ****
>
> It appears that the "lenders" are working to circumvent the Debtor filing
> a lawsuit to litigate Chain of Title or other Issues after discharge. The
> Debtor does not have standing to litigate in Chapter 7 because the Trustee
> steps into the shoes of the Debtor and can refuse to litigate. The Debtor
> would have to litigate outside of Bankruptcy, maybe before filing the
> petition.
> The "lenders" actions are also cutting off Debtors rights under the HBOR.
> Perhaps Relief from Stay limited to negotiations would circumvent the offer
> to the Trustee. ****
>
> ****
>
> ****
>
> Law Office of Catherine Christiansen
> 17011 Beach Blvd. Ste 900, Huntington Beach, CA 92647
> Tel: (714) 375-6651 Fax: (562) 490-8572
> attorneychristiansen@gmail.com****
>
> ****
>
> ****
> ------------------------------
>
> *From:* "jesseelaw@aol.com"
> *To:* cdcbaa@yahoogroups.com
> *Sent:* Thursday, March 14, 2013 8:56 PM
> *Subject:* Re: [cdcbaa] Re: Chapter 7 Trustee Forcing Short Sale****
>
> ****
>
> ****
>
> It appears to me that the lender is not waiving a portion of its claim
> but rather assigning part of its claim to the Chapter 7 trustee in
> consideration for being paid without the hassle, delay and uncertainty of
> pursuing a foreclosure sale. Thus no equity is created for the debtor to
> exempt. I agree with Larry that a judgment lien's treatment where there is
> negative equity as in Higgins is distinguishable from a voluntary lien
> situation. ****
>
> ****
>
> That said, I do not like the potential resulting consequences for my
> debtor clients and would try and find a way to dissuade the Chapter 7
> trustee from pursuing a short sale. In the personal residence context
> it seems antithetical to the concept of a fresh start for a trustee to
> short sell a property out from under a debtor without any proceeds being
> exemptible, but I warn all who are underwater on their real property of the
> possibility of a Chapter 7 trustee attempting a short sale. ****
>
> ****
>
> Mark T. Jessee
> Law Offices of Mark T. Jessee
> "A Debt Relief Agency"
> 50 W. Hillcrest Drive, Suite 200
> Thousand Oaks, CA 91360
> (805) 497-5868 (805) 497-5864 (Facsimile)****
>
> ****
>
> In a message dated 3/14/2013 8:24:40 P.M. Pacific Daylight Time,
> mitnicklaw@aol.com writes:****
>
> ****
>
> The homestead protects equity in the real property. When the bank agrees
> to accept less than its full claim, it creates equity that the debtor
> should be allowed to protect.
>
> Sent from my iPhone ****
>
> Law Office of Eric Alan Mitnick ****
>
> (310) 792-5864 MitnickLaw@aol.com****
>
> Communications and attachments may be confidential and attorney-client
> privileged. ****
>
>
> On Mar 14, 2013, at 1:57 PM, Dennis wrote:****
>
> ****
>
> The bank has a lien for x. The bank says it will give trustee so many
> dollars of it's property. How in sam hill is that property of the debtor?
> If not property of debtor, how can it be exempted.****
>
> ****
>
> D
>
> Sent from my iPhone****
>
>
> On 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." law@...> 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" attorneypaul2000@...> 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" cliff@...> 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 bklawr@...> 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@...
> >
> >****
>
> ****
>
>
>
>
>
> ****
>
> ****
>
>
>
Marvin Mann
2706 Artesia Blvd A
Redondo Beach, CA 90278
Interesting opinion from last monthOn Fri, Mar 15, 2013 at 9:47 AM, Wesley H. Avery <wavery@rpmlaw.com> wrote:
Touch
cdcbaa@yahoogroups.com, Larry Simons <larry@...> 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." <law@...<mailto:law@...>> 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" <attorneypaul2000@...<mailto:attorneypaul2000@...>> 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
>
>
> ________________________________
...%3cmailto:law@..." target"_blank">law@...<mailto:law@...>>
> To: "cdcbaa@yahoogroups.com<mailto:cdcbaa@yahoogroups.comcdcbaa@yahoogroups.com<mailto: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" <
The post was migrated from Yahoo.

It appears that the "lenders" are working to circumvent the Debtor filing a lawsuit to litigate Chain of Title or other Issues after discharge. The Debtor does not have standing to litigate in Chapter 7 because the Trustee steps into the shoes of the Debtor and can refuse to litigate. The Debtor would have to
litigate outside of Bankruptcy, maybe before filing the petition.
The "lenders" actions are also cutting off Debtors rights under the HBOR.e offer to the Trustee.
Law Office of Catherine Christiansen
17011 Beach Blvd. Ste 900, Huntington Beach, CA 92647
Tel: (714) 375-6651 Fax: (562) 490-8572
attorneychristiansen@gmail.com
________________________________
To: cdcbaa@yahoogroups.com
Sent: Thursday, March 14, 2013 8:56 PM
Subject: Re: [cdcbaa] Re: Chapter 7 Trustee Forcing Short Sale
It appears to me that thelender is not waiving a portion of its claimbutrather assigning part of its claim to the Chapter 7 trustee in
consideration for being paid without the hassle, delay and uncertainty of
pursuing a foreclosure sale.Thus no equity is created for the debtor to
exempt. I agree with Larry that a judgment lien's treatment where there is
negative equity as inHiggins is distinguishable from a voluntary liensituation.
That said, I do not like the potential resulting consequences for my debtorclients and would try and find a way to dissuade the Chapter 7 trustee frompursuing a short sale. In the personal residence context itseems
antithetical to the concept of a fresh start for a trustee to short sell aproperty out from under a debtor without any proceeds being exemptible,
butIwarnallwho are underwater on their real
propertyof the possibility of a Chapter 7 trustee attempting a shortsale.
Mark T.
Jessee
Law Offices of Mark T. Jessee
"A Debt Relief Agency"
50 W.
Hillcrest Drive, Suite 200
Thousand Oaks, CA 91360
(805) 497-5868 (805)
497-5864 (Facsimile)
In a message dated 3/14/2013 8:24:40 P.M. Pacific Daylight Time,
mitnicklaw@aol.com writes:
>The homestead protects equity in the real property. When the bank agrees to accept less than its full claim, it creates equity that the debtor should be allowed to protect.
>
>Sent from my iPhone
>Law Office of Eric Alan Mitnick
>(310) 792-5864 MitnickLaw@aol.com
>Communications and attachments may be confidential and attorney-client privileged.
>
>On Mar 14, 2013, at 1:57 PM, Dennis wrote:
>
>
>
>>The bank has a lien for x. The bank says it will give trustee so many dollars of it's property. How in sam hill is that property of the debtor? If not property of debtor, how can it be exempted.
>>
>>
>>D
>>
>>Sent from my iPhone
>>
>>On 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"

The post was migrated from Yahoo.

It appears to me that the lender is not waiving a portion of its claim butrather assigning part of its claim to the Chapter 7 trustee in
consideration for being paid without the hassle, delay and uncertainty of pursuing a
foreclosure sale. Thus no equity is created for the debtor to exempt. I
agree with Larry that a judgment lien's treatment where there is negativeequity as in Higgins is distinguishable from a voluntary lien situation. That said, I do not like the potential resulting consequences for my debtor clients and would try and find a way to dissuade the Chapter 7 trustee
from pursuing a short sale. In the personal residence context it seems antithetical to the concept of a fresh start for a trustee to short sell a property out from under a debtor without any proceeds being exemptible, but I
warn all who are underwater on their real property of the possibility of aChapter 7 trustee attempting a short sale.
Mark T. Jessee
Law Offices of Mark T. Jessee
"A Debt Relief Agency"
50 W. Hillcrest Drive, Suite 200
Thousand Oaks, CA 91360
(805) 497-5868 (805) 497-5864 (Facsimile)
In a message dated 3/14/2013 8:24:40 P.M. Pacific Daylight Time,
mitnicklaw@aol.com writes:
The homestead protects equity in the real property. When the bank agrees to accept less than its full claim, it creates equity that the debtor should
be allowed to protect.
Sent from my iPhone
Law Office of Eric Alan Mitnick
(310) 792-5864 _MitnickLaw@aol.com_ (mailto:MitnickLaw@aol.com)
Communications and attachments may be confidential and attorney-client
privileged.
On Mar 14, 2013, at 1:57 PM, Dennis wrote:
The bank has a lien for x. The bank says it will give trustee so many
dollars of it's property. How in sam hill is that property of the debtor? If
not property of debtor, how can it be exempted.
D
Sent from my iPhone
On Mar 12, 2013, at 11:17 PM, "jbsesq1965" wrote:
I disagree. What's the authority for the position that the bank carve outisn'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'tread 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 thebank 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
(mailto:cdcbaa@yahoogroups.com) , Larry Simons wrote:
>
> But if the lenders are giving the trustee a carve out, those monies arenot something that can be exempted. Essentially, the trustee is sharing the
lien position with the lender giving the carve out. Secured liens are paidbefore 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 originaland 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: " (mailto:cdcbaa@yahoogroups.com) _cdcbaa@yahoogroups.com_
(mailto: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 andmotion 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 originaland 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 isprepared 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 conversionprobably 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 thehouse, 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/) _http://www.bklaw.com/_
(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 meansat

The post was migrated from Yahoo.

The homestead protects equity in the real property. When the bank agrees to accept less than its full claim, it creates equity that the debtor should be allowed to protect.
Sent from my iPhone
Law Office of Eric Alan Mitnick
(310) 792-5864 MitnickLaw@aol.com
Communications and attachments may be confidential and attorney-client privileged.
On Mar 14, 2013, at 1:57 PM, Dennis wrote:
> The bank has a lien for x. The bank says it will give trustee so many dollars of it's property. How in sam hill is that property of the debtor? If not property of debtor, how can it be exempted.
>
> D
>
> Sent from my iPhone
>
> On 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
>> > 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 homestead protects equity in the real property. When the bank agrees to accept less than its full claim, it creates equity that the debtor should be allowed to protect. Sent from my iPhoneLaw Office of Eric Alan Mitnick (310) 792-5864 MitnickLaw@aol.comCommunications and attachments may be confidential and attorney-client privileged. On Mar 14, 2013, at 1:57 PM, Dennis <cdcbaamailbox@gmail.com> wrote:

The bank has a lien for x. The bank says it will give trustee so many dollars of it's property. How in sam hill is that property of the debtor? If not property of debtor, how can it be exempted.DSent from my iPhoneOn Mar 12, 2013, at 11:17 PM, "jbsesq1965" <jsmith@cgsattys.com> 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
cbaa@yahoogroups.com">cdcbaa@yahoogroups.com, Larry Simons <larry@...> 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." <law@...<mailto:law@...>> 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" <attorneypaul2000@...<mailto:attorneypaul2000@...>> 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<mailto:cdcbaa@yahoogroups.comcdcbaa@yahoogroups.com<mailto: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" <cliff@...<mailto:cliff@...>> 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 <bklawr@...<mailto:bklawr@...>> 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
> <blslogoemail.gif>
> This Firm is a Qualified Federal Debt Relief Agency (see what this means at
The post was migrated from Yahoo.

The bank has a lien for x. The bank says it will give trustee so many dollars of it's property. How in sam hill is that property of the debtor? If not property of debtor, how can it be exempted.
D
Sent from my iPhone
On 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
> > 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 bank has a lien for x. The bank says it will give trustee so many dollars of it's property. How in sam hill is that property of the debtor? If not property of debtor, how can it be exempted.DSent from my iPhoneOn Mar 12, 2013, at 11:17 PM, "jbsesq1965" <jsmith@cgsattys.com> 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
@yahoogroups.com">cdcbaa@yahoogroups.com, Larry Simons <larry@...> 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." <law@...<mailto:law@...>> 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" <attorneypaul2000@...<mailto:attorneypaul2000@...>> 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<mailto:cdcbaa@yahoogroups.com
The post was migrated from Yahoo.

Jeff,
Wes Avery and I had talked about this and he had provided some Supreme Court cites giving authority to trustee's to undertake such action. We should ask Wes to chime in. I will say that I believe consensual mortgages are different than judgment liens and therefore the Higgins case is distinguishable.
Larry

The post was migrated from Yahoo.

Thanks Larry, I really appreciate it and I apologize if I put you on the spot in a public forum like this. I was just worried that you might be aware of some definitive authority that says that a trustee negotiated carve out is not-exemptable. By your response I take it that unless there is some authority none of us have seen, the issue is still subject to interpretation. If so, then I continue to advise clients and colleagues who have a trustee that wants to force a sale on a house they want to try to save, to use available exemptions to thwart that. It puts the onus on the trustee to file an objection to the exemption or get enough money in the carve out for the exemption and the costs and get $$ for the estate.
In your example of the abandoned property, I have no problem with a trustee trying to arrange a short sale and think that is a win win. The debtor can't use a homestead in a property where they don't reside, and are unlikely to use a wild card to protect abandoned property if they need to protect cars jewelry and such. If the trustee can use that property to create a dividend to the unsecured creditors, he/she could and should, as far as I'm concerned. It seems there will be some litigation though in the case of a debtor who is still living in the property, behind on the payments and really hoping to get a loan modification with the lender during or after the Chapter 7.
FREE PRACTICE TIP for the unsuspecting practitioner. If your Chapter 7 trustee changes your no-asset case to an asset case using this, or any other power at his/her disposal, confirm with your client that the creditor list is 100% complete. Inadvertently omitted creditors are discharged in a no-asset no Bar Date case (In Re Beezley, et.cet.). But when the trustee finds assets and then sets a claims bar date, an inadvertently omitted creditor is NOT discharged (523(a)(3)), and need not bring an adversary to claim that the debt is not discharged (523(c)). I make a point of letting my clients know this law when a case is an asset case, or becomes one. I almost ALWAYS find out the clients will "remember" someone they "forgot" to list. We add them in time for them to make a claim and preserve the discharge... and avoid malpractice.
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
>
> Jeff,
>
> Let me start off by saying that although I am aware of trustee's conducting short sales, I have not started the process as of yet. I will also further disclose that I am investigating my first potential short sale. In my case, the property is vacant and not the debtor's primary residence. Each trustee has their own parameters.
>
> I liken the short sale concept to a similar procedure utilized by trustees under 551. If a trustee recovers an avoidable lien, they step into the shoes of the recovered lienholder. Also, there are situations where the trustee can assume the position of the IRS.
>
> I agree with the propositions that (1) a debtor can exempt negative equity; and (2) the holding of Higgins.
>
> I think this is an evolving area and judges will have to decide these positions as they come before them.
>
jbsesq1965
> Sent: Wednesday, March 13, 2013 9:56 AM
> To: cdcbaa@yahoogroups.com
> Subject: [cdcbaa] Re: Chapter 7 Trustee Forcing Short Sale
>
>
>
> 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
>
> --- In cdcbaa@yahoogroups.com, "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
The post was migrated from Yahoo.

You have to be proactive about this correct? What I mean is, can you wait
until the trustee acts in reliance on your schedules then switch excemption
schemes and take a 75k+ homestead on property that is neg equity (or
whatever).
I am not a tax guy but have you all considered the tax consequences of
something like this as a deterrant to the sale? Bought a house for 200k,
refinanced when the price was high etc, and now it's worth say 300k with a
700k in liens on it. To make it easy, assume 1 lender. Assume the lender
says they'll take a hit, sell it for 300k with 25k of it going to the
unsecured. How would that play out?
I want to say that the 400k which is forgiven is either taxable income, or
if it's not taxable, the basis of the property gets reduced by 400k. Since
the basis was only 200k to begin with (am I right?), the new basis is now 0
so the short sale will net the estate 300k in taxable income. I also assume
that the estate pays tax like an individual (again, not sure), so that it
would be hit with a fairly heavy tax of approximately 75 to 100k.
The biggest problem with my analysis is I don't know the estate's basis in
the assets it acquires. It could be that its basis is 700k because it took
the asset subject to an encumberance of 700k + 0 for what it paid for it.
Sincerely,
Michael Avanesian
On Wed, Mar 13, 2013 at 11:09 AM, Mark J. Markus wrote:
> **
>
>
> We had a nice discussion on this at our table at the Inn of Court last
> night (with a Trustee at our table).
>
> I think the bottom line is these need to be contested, and it sounds like
> the homestead exemption is the best way to do it. I've used Higgins for
> years avoiding negative equity judicial liens under 522(f) and there is
> certainly a logic which can allow it to be applied in these short sale
> scenarios.
>
> Counsel your clients of the risk, and possibility of additional fees.
>
> *************************
> 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 3/13/2013 10:18 AM, Larry Simons wrote:
>
> Jeff,****
>
> ** **
>
> Let me start off by saying that although I am aware of trustees
> conducting short sales, I have not started the process as of yet. I will
> also further disclose that I am investigating my first potential short
> sale. In my case, the property is vacant and not the debtors primary
> residence. Each trustee has their own parameters.****
>
> ** **
>
> I liken the short sale concept to a similar procedure utilized by trustees
> under 551. If a trustee recovers an avoidable lien, they step into the
> shoes of the recovered lienholder. Also, there are situations where the
> trustee can assume the position of the IRS.****
>
> ** **
>
> I agree with the propositions that (1) a debtor can exempt negative
> equity; and (2) the holding of *Higgins. *****
>
> ** **
>
> I think this is an evolving area and judges will have to decide these
> positions as they come before them.****
>
> ** **
>
> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com]
> *On Behalf Of *jbsesq1965
> *Sent:* Wednesday, March 13, 2013 9:56 AM
> *To:* cdcbaa@yahoogroups.com
> *Subject:* [cdcbaa] Re: Chapter 7 Trustee Forcing Short Sale****
>
> ** **
>
> ****
>
> 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
>
> --- In cdcbaa@yahoogroups.com, "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@
> > >
> > >
> >****
>
> ****
>
>
>
>
You have to be proactive about this correct? What I mean is,can you wait until the trustee acts in reliance on your schedules then switch excemption schemes and take a 75k+ homestead on property that is neg equity (or whatever).
I am not a tax guy but have you all considered the tax consequences of something like this as a deterrant to the sale? Bought a house for 200k, refinanced when the price was high etc, and now it's worth say 300k with a 700k in liens on it. To make it easy, assume 1 lender. Assume the lender says they'll take a hit, sell it for 300k with 25k of it going to the unsecured. How would that play out?
I want to say that the 400k which is forgiven is either taxable income, or if it's not taxable, the basis of the property gets reduced by 400k. Since the basis was only 200k to begin with (am I right?), the new basis is now 0 so the short sale will net the estate 300k in taxable income. I also assume that the estate pays tax like an individual (again, not sure), so that it would be hit with a fairly heavy tax of approximately 75 to 100k.
The biggest problem with my analysis is I don't know the estate's basis in the assets it acquires. It could be that its basis is 700k because it took the asset subject to an encumberance of 700k + 0 for what it paid for it.
Sincerely, Michael Avanesian Mark J. Markus <bklawr@yahoo.com> wrote:

The post was migrated from Yahoo.

We had a nice discussion on this at our table at the Inn of Court
last night (with a Trustee at our table).
I think the bottom line is these need to be contested, and it sounds
like the homestead exemption is the best way to do it. I've used
Higgins for years avoiding negative equity judicial liens under
522(f) and there is certainly a logic which can allow it to be
applied in these short sale scenarios.
Counsel your clients of the risk, and possibility of additional fees.
*************************
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.

Jeff,
Let me start off by saying that although I am aware of trustee's conducting short sales, I have not started the process as of yet. I will also further disclose that I am investigating my first potential short sale. In my case, the property is vacant and not the debtor's primary residence. Each trustee has their own parameters.
I liken the short sale concept to a similar procedure utilized by trustees under 551. If a trustee recovers an avoidable lien, they step into the shoes of the recovered lienholder. Also, there are situations where the trustee can assume the position of the IRS.
I agree with the propositions that (1) a debtor can exempt negative equity; and (2) the holding of Higgins.
I think this is an evolving area and judges will have to decide these positions as they come before them.

The post was migrated from Yahoo.