Central District Consumer Bankruptcy Attorney's Association

Also this sounds like loan proceeds, i.e. not to be included in the means
test......
David A. Tilem
Certified Bankruptcy Specialist*
Law Offices of David A. Tilem (a debt relief agency)
206 N. Jackson Street, #201, Glendale, CA 91206
Tel: 818-507-6000 Fax: 818-507-6800
* Bankruptcy specialist cert. by State Bar of CA Bd of Legal
Specialization.

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Sure sounds like it to me. However, is he receiving income from the reverse mortgage? If that is found it could be subject to execution if in a bank account. But, if there is no other cash flow and no other assets then a letter to the creditors telling them that he is judgment proof works in about half of the cases.
Jim King

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More and more I am advising clients just to sit tight - go judgment proof
for awhile even if they have to put up with a 25% garnishment. No
work/legal fees for me, but hey, it's what the clients need and that's what
counts.
The worst problem they often have is CHEX. Often these people have no
access to bank accounts and that forces them into an underground/cash
economy. They get by using accounts from friends, spouses, relatives,
businesses, but it really is a growing problem.
David A. Tilem
Certified Bankruptcy Specialist*
Law Offices of David A. Tilem (a debt relief agency)
206 N. Jackson Street, #201, Glendale, CA 91206
Tel: 818-507-6000 Fax: 818-507-6800
* Bankruptcy specialist cert. by State Bar of CA Bd of Legal
Specialization.

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Hi, Pat: The problem was the possible risk of default leading to a transfer
of ownership of the property from the debtor to the lender. (which wasn't
supposed to happen until the death of the debtor). This debtor was too old to
accept that risk.

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Thanks to all for replying! The feedback on this question alone was
worth the membership dues! Actually, given Steven's experience which
he outlined above, perhaps it would be more accurate to call it the
best/cheapest insurance policy I ever purchased - this particular
client is a kind elderly gentleman where if there is even the
slightest possibility of trouble, I don't want to file, because he
can't take that kind of stress.
I will obviously make it a point to review Section 365, but in the
meantime, I'm asking myself more and more if he really NEEDS to file -
between his age, the fact that his only income is SS, and that,
besides the home, which is really not viable in lieu of the reverse
mortgage, he's owns NOTHING, is he not judgment proof for all
practical purposes?
wrote:
>
> I think they may be executory contracts - See Sect. 365.
>
>
> David A. Tilem
> Certified Bankruptcy Specialist*
> Law Offices of David A. Tilem (a debt relief agency)
> 206 N. Jackson Street, #201, Glendale, CA 91206
> Tel: 818-507-6000 Fax: 818-507-6800
>
> * Bankruptcy specialist cert. by State Bar of CA Bd of Legal
> Specialization.
> Business bankruptcy specialist cert. by Amer. Bd. of
Certification
> -----Original Message-----
Behalf Of
> Patrick Green
> Sent: Thursday, May 01, 2008 11:22 AM
> To: cdcbaa@yahoogroups.com
> Subject: RE: [cdcbaa] Anyone with experience re reverse mortgages?
>
>
>
>
> Steve:
>
> When I read (e)(2)(b), it reads like a prospective portion of the
contract
> has not been executed. It strikes me that it means that a lender,
who has
> contracted to lend someone money, but has not yet released the
funds or has
> a contract to release more funds, may chose to exercise their
rights under
> the ipso facto clause. If it were otherwise, then we never would
have had
> the ride through, which hinged on the (e)(1).
>
> As many reverse mortgages are lines of credit, (e)(2) would seem to
allow
> the lender to not let the debtor take any more money on the line.
>
> Pat
>
> Patrick T. Green, Esq.
>
> Fitzgerald & Green
>
> Attorneys at Law
>
> 1010 E. Union Street
>
> Suite 206
>
> Pasadena, CA 91106
>
> Tel: 626-449-8433
>
> Fax: 626-449-0565
>
> pat@...
>
Behalf Of
> SLBLAW1@...
> Sent: Tuesday, April 29, 2008 6:48 PM
> To: cdcbaa@yahoogroups.com
> Subject: Re: [cdcbaa] Anyone with experience re reverse mortgages?
>
> Hi. I did have a troubling experience with a reverse mortgage.
After a
> chapter 7 was filed, the lender argued that the default provision
in the
> contract was triggered, and the loan would be called. I argued
that Sec
> 365(e)(1) protected the debtor (the "ipso facto" provision"). The
lender
> countered with Sec 365(e)(2)(b), which basically sez that provision
does not
> apply "in a contract to make a loan." The calling of a reverse
mortgage
> would have been disastrous in its negative effect to the debtor.
The lender
> agreed to back off if the case was dismissed. I made the motion;
it was
> dismissed.
>
>
> Steven L. Bryson
>
> Certified Specialist
>
> Personal & Small Business
>
> Bankruptcy Law
>
> (310) 477-4555 >
>
>
>
> **************
> Need a new ride? Check out the largest site for U.S. used car
listings at
> AOL Autos.
> (http://autos.aol.com/used?NCIDaolcmp00300000002851)
>

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I think they may be executory contracts - See Sect. 365.
David A. Tilem
Certified Bankruptcy Specialist*
Law Offices of David A. Tilem (a debt relief agency)
206 N. Jackson Street, #201, Glendale, CA 91206
Tel: 818-507-6000 Fax: 818-507-6800
* Bankruptcy specialist cert. by State Bar of CA Bd of Legal
Specialization.
Patrick Green
Sent: Thursday, May 01, 2008 11:22 AM
To: cdcbaa@yahoogroups.com
Subject: RE: [cdcbaa] Anyone with experience re reverse mortgages?
Steve:
When I read (e)(2)(b), it reads like a prospective portion of the contract
has not been executed. It strikes me that it means that a lender, who has
contracted to lend someone money, but has not yet released the funds or has
a contract to release more funds, may chose to exercise their rights under
the ipso facto clause. If it were otherwise, then we never would have had
the ride through, which hinged on the (e)(1).
As many reverse mortgages are lines of credit, (e)(2) would seem to allow
the lender to not let the debtor take any more money on the line.
Pat
Patrick T. Green, Esq.
Fitzgerald & Green
Attorneys at Law
1010 E. Union Street
Suite 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com

The post was migrated from Yahoo.

Steve:
When I read (e)(2)(b), it reads like a prospective portion of the contract
has not been executed. It strikes me that it means that a lender, who has
contracted to lend someone money, but has not yet released the funds or has
a contract to release more funds, may chose to exercise their rights under
the ipso facto clause. If it were otherwise, then we never would have had
the ride through, which hinged on the (e)(1).
As many reverse mortgages are lines of credit, (e)(2) would seem to allow
the lender to not let the debtor take any more money on the line.
Pat
Patrick T. Green, Esq.
Fitzgerald & Green
Attorneys at Law
1010 E. Union Street
Suite 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com

The post was migrated from Yahoo.

charset="windows-1251"
In addition to ipso facto argument, See
Platinum Capital, Inc. v. Sylmar Plaza, L.P. (In re Sylmar Plaza, L.P.), 314
F.3d 1070, 1075 (9th Cir. 2002); In re Entz-White Lumber and Supply, Inc.,
850 F.2d 1338, 1342 (9th Cir. 1988).
David A. Tilem
Certified Bankruptcy Specialist*
Law Offices of David A. Tilem (a debt relief agency)
206 N. Jackson Street, #201, Glendale, CA 91206
Tel: 818-507-6000 Fax: 818-507-6800
* Bankruptcy specialist cert. by State Bar of CA Bd of Legal
Specialization.
SLBLAW1@aol.com
Sent: Tuesday, April 29, 2008 5:48 PM
To: cdcbaa@yahoogroups.com
Subject: Re: [cdcbaa] Anyone with experience re reverse mortgages?
Hi. I did have a troubling experience with a reverse mortgage. After a
chapter 7 was filed, the lender argued that the default provision in the
contract was triggered, and the loan would be called. I argued that Sec
365(e)(1) protected the debtor (the "ipso facto" provision"). The lender
countered with Sec 365(e)(2)(b), which basically sez that provision does not
apply "in a contract to make a loan." The calling of a reverse mortgage
would have been disastrous in its negative effect to the debtor. The lender
agreed to back off if the case was dismissed. I made the motion; it was
dismissed.
Steven L. Bryson
Certified Specialist
Personal & Small Business
Bankruptcy Law
(310) 477-4555
**************
Need a new ride? Check out the largest site for U.S. used car listings at
AOL Autos.
(http://autos.aol.com/used?NCIDaolcmp00300000002851)
charset="windows-1251"
Message
In addition to ipso facto
argument, See
Platinum Capital, Inc. v. Sylmar Plaza, L.P. (In re Sylmar Plaza,L.P.), 314 F.3d 1070, 1075 (9th Cir. 2002); In re Entz-White
Lumber and Supply, Inc., 850 F.2d 1338, 1342 (9th Cir. 1988).


David A.
Tilem
Certified Bankruptcy
Specialist*
The post was migrated from Yahoo.

Hi. I did have a troubling experience with a reverse mortgage. After a
chapter 7 was filed, the lender argued that the default provision in the contract
was triggered, and the loan would be called. I argued that Sec 365(e)(1)
protected the debtor (the "ipso facto" provision"). The lender countered with Sec
365(e)(2)(b), which basically sez that provision does not apply "in a
contract to make a loan." The calling of a reverse mortgage would have been
disastrous in its negative effect to the debtor. The lender agreed to back off if the
case was dismissed. I made the motion; it was dismissed.

The post was migrated from Yahoo.

Client is an (obviously) elderly man who reverse mortgaged his home
some 5 1/2 years ago. Between the amount owed on the mortgage and the
falling home value, there isn't really any issue regarding exemptions.
However, I have read in numerous sources that with reverse mortgages, a
subsequent bankruptcy filing acts as a default and that the lender can
then call the entire amount due - in other words, it triggers an
acceleration clause. Has anyone else heard of this, and is it true?
Obviously, if that is even a remote possibility, we are not going to go
forward with this case.
Moreover, given the guy's age, and the fact that other than the house
he has no assets at all, I have to think he might well be essentially
judgment-proof anyway. To the extent that he has no plans of ever
selling the house, and as it is reverse-mortgaged it goes back to the
lender anyway, I'm seriously wondering if it is imperative he files his
7.
Anyone have any experience with such a scenario?

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