Good morning! Something material has changed in my ongoing divorce saga, and I might... might... qualify for a Chapter 7. But before calling my BK attorney, I'd like to ask a question here, please.
In my settlement, I will be keeping the marital residence and the two rental houses. As far as the marital home:
* I plan to keep the house.
* Her name stays on the title until I refinance.
* Upon a successful refinance, she will quitclaim all interest to me with no money to her.
* There is a positive equity of $25,000
As far as the rental homes:
* Both of our names are on the mortgages.
* The properties are actually titled under an LLC (call it "Broken Homes, LLC" if you want to make a joke.)
* The LLC is a single-member LLC, my sole ownership. The property settlement confirms this; the ex has no interest in the LLC.
* House #1 has a positive equity of $25,000. I cannot sell it for personal reasons.
* House #2 has a negative equity of -$15,000. I cannot surrender it due to protecting my ex's credit.
So my questions are about how these homes would be valued by the trustee, and how to apply exemptions. I am in Arkansas, and will be using the federal exemptions.
For the marital house: on the day of filing bankruptcy, the ex will still be on the title. Will the trustee value the house as solely mine for $25,000 or will the trustee split the ownership?
For the rental houses: will the trustee value the houses together under the LLC (for a net of $10,000) or will the trustee ignore the LLC and value the houses separately? This is important to me; if the trustee lumps them together, the net equity is $10,000 and after the federal exemptions, I can scrape up the cash to redeem them. If the trustee values them separately, then house #1 is $25,000 and I do not have the cash to redeem it, forcing me back into Chapter 13.
I realize this may be a question that is very specific to my trustees, but if any of the gurus here have seen something similar, I'd be grateful for your thoughts and comments.
Thank you everybody!
In my settlement, I will be keeping the marital residence and the two rental houses. As far as the marital home:
* I plan to keep the house.
* Her name stays on the title until I refinance.
* Upon a successful refinance, she will quitclaim all interest to me with no money to her.
* There is a positive equity of $25,000
As far as the rental homes:
* Both of our names are on the mortgages.
* The properties are actually titled under an LLC (call it "Broken Homes, LLC" if you want to make a joke.)
* The LLC is a single-member LLC, my sole ownership. The property settlement confirms this; the ex has no interest in the LLC.
* House #1 has a positive equity of $25,000. I cannot sell it for personal reasons.
* House #2 has a negative equity of -$15,000. I cannot surrender it due to protecting my ex's credit.
So my questions are about how these homes would be valued by the trustee, and how to apply exemptions. I am in Arkansas, and will be using the federal exemptions.
For the marital house: on the day of filing bankruptcy, the ex will still be on the title. Will the trustee value the house as solely mine for $25,000 or will the trustee split the ownership?
For the rental houses: will the trustee value the houses together under the LLC (for a net of $10,000) or will the trustee ignore the LLC and value the houses separately? This is important to me; if the trustee lumps them together, the net equity is $10,000 and after the federal exemptions, I can scrape up the cash to redeem them. If the trustee values them separately, then house #1 is $25,000 and I do not have the cash to redeem it, forcing me back into Chapter 13.
I realize this may be a question that is very specific to my trustees, but if any of the gurus here have seen something similar, I'd be grateful for your thoughts and comments.
Thank you everybody!
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