Citrus Heights bankruptcy attorneys are often asked if a homeowner going through reorganizational bankruptcy can sell their property during a Chapter 13 bankruptcy. While there is nothing in the US Bankruptcy law preventing you from selling the property during Chapter 13, there are significant questions to ask first. If you decide that selling a home in Chapter 13 bankruptcy is the best option at your disposal there are steps that you must follow in order to obtain the approval from the Bankruptcy Judge.
Should I Sell My House in Bankruptcy?
SHOULD you sell your house during your California Bankruptcy Chapter 13 repayment period is the exact question you should be asking? We know that it is legal to do so, but selling your home before your Chapter 13 bankruptcy is finished may not be beneficial to you at all. In fact, it may undermine the entire point of declaring Chapter 13 bankruptcy in the first place.
Once you file Chapter 13 bankruptcy, you are awarded an automatic stay that immediately halts all debt collection attempts against you. This includes home foreclosure, and therefore, the case is a tool to prevent the sale of a home while giving you a chance to repay part or all of your debts. With this in mind, Citrus Heights bankruptcy attorneys consider the strong benefits of waiting on selling a home until you have received a discharge.
How to Sell Your Home in Chapter 13
In order to sell your home in Chapter 13 bankruptcy, you must obtain permission to do so from the US Bankruptcy Court where you filed for debt relief protection. In order to initiate the sale of your house during chapter 13 bankruptcy contact your bankruptcy lawyer who can help you present the bankruptcy trustee with the proper notice of intent, as well as, to ensure the terms of the sale are approved by the bankruptcy court. The purchase price must be fair based on the current market value and conditions. In addition, creditors must be notified and giving a chance to overbid for the purchase of the home.
Property Transfers in Bankruptcy
All changes in income or transfers of property during your Chapter 13 bankruptcy need to be disclosed to the bankruptcy trustee. Ensure you speak with a bankruptcy attorney in Sacramento California before you consider selling your home in Chapter 13 to ensure you are taking the best steps towards living debt free.