The Significance of Closing an Asset Case

[justbroke]

Don't be impatient when it comes to the case closing. It's only an "administrative" task. Let the Trustee fully administer your case and don't panic. You received your discharge, and that's the thing that actually gets rid of your debt.

If, after 6 months and no additional property (including money) is due to the Trustee, then you may want to ask about the close. Unless and until the Trustee files the final Distribution report, you case isn't closing. Most Trustee offices wait at least 30-60 days after sending out checks to creditors, because they want to make sure all checks are cashed.

[backtoschool]

Its been over six weeks since my trustee filed his final report in my case and I was told that it takes over two months after the trustee files the final report of distribution for an asset case to close. The asset money has to be transferred to the official bank account and then checks to the creditors have to be cut and then they wait for the checks to clear and then file the final paper work. But once the trustee files his/her final report then the case is just waiting for a few clean up items. At least that is what I was told by my lawyer.

[backtoschool]

My trustee filed his final report, abandoned all my other assets, and filed his final asset distribution matrix on March 3. The cash from my assets were deposited into the court payment account to pay out to creditors the same day. I called the clerk's office to find out a ballpark date of when my case might close and they said that each creditor has 90 days to cash the check sent to them by the clerk's office. The case cannot close until each check is cashed. If the checks are not cashed any uncashed checks are voided and put back into a fund and redistributed to the remaining creditors. Since some of these checks to my creditors were for literally $2 dollars, I find this whole process rather amusing. It is costing WAY more to process my $1,000 in assets than the assets are worth when you consider the court clerk's time, etc....

I am just posting this update so it will be in the record, since many people wonder when asset cases close, and what happens after discharge in an asset case.

[Jan]

Funny, we are an asset case and NO creditors have filed a Proof of Claim. The last day to file was 4/29. How long will it take for ours to close and have all our cash returned to us????? I don't even think the Trustee can take a commission because no disbursements will be made....................looking forward to the return of our $$$$!

[justbroke]

I can't tell you how long it will take. It's up to the Trustee.

[liboton21]

This is what I got from PACER on May 10, document dated May 6, 2010.

Order of Discharge in the above referenced case was entered on 4/22/10, and notice was provided to parties in interest. Since it appears that no further matters are required that this case remain open, or that the jurisdiction of this Court continue, it is ordered that the Trustee is discharged from his/her duties in this case, his/her bond is exonerated, and the case is closed.

Does it mean case CLOSED?

[backtoschool]

This is what I got from PACER on May 10, document dated May 6, 2010.

Order of Discharge in the above referenced case was entered on 4/22/10, and notice was provided to parties in interest. Since it appears that no further matters are required that this case remain open, or that the jurisdiction of this Court continue, it is ordered that the Trustee is discharged from his/her duties in this case, his/her bond is exonerated, and the case is closed.

Does it mean case CLOSED?

No, it just means that the trustee is done administering your case. You will still have to wait for all of the clerk actions such as paying the creditors, waiting for the checks to clear, etc...

[kw1025]

This is really starting to bother me. I was dischared Dec 2009 with a ton of underwater properties in florida, but a few rental properties i own near my home in NY. It is my intent to buy them back, but i have heard nothing from the trustee about case closing, whether he is going to abandon the, etc. The properties most likely have some equity, BUT he values keep going up and down relative to the general economy. I want to know whether i am going to have to buy these back, or what....just for planning purposes...

[kw1025]

oh ya.... what if the trustee takes a year to decide whether he wants to pursue the rental properties, and the market value goes up 100%? Do i have to buy back at a higher %??

[ColoradoBell]

Well this tread, especially Ch007's sitch, is honing in on my problem and giving e a little ray of hope on an otherwise horrific Friday.

So, justbroke, another takeover of original OP's thread with my questions.

Here's the deal: I have a home I spent 5 years of my life building. In a divorce, in 2005 it was ordered fixed up and sold, but X wouldn't let me fix it up. He convinced the judge to have it sold 'as is'. A receiver was appointed. Receiver is a crook as is judge and together things have gotten FUBAR. The house appraised 'as is' at $1.5mil, but the Receiver is trying to sell it to a friend for $600k. (long story, leaving lots out) I thought I had some time to file BUT Receiver asked judge to evict me (no debt on home and I keep it in terrific shape) because buyer thinks Im gonna sue him (No, gonna sue Receiver). I got 3 days notice of this hearing to evict me and shot down when I asked for a continuance to prepare my defense. (Getting the pic here?) But my response shook them a little because I laid out the not arms length transaction in pretty stark detail...they sure didn't want me getting such juicy stuff into the record.

SO.... suddenly a new contract appeared YESTERDAY. For $600,001 (a coincidental price I'm sure, as of course new buyer shouldn't know what old buyer's contract is for) . This contract demands a closing in 30 days. Offer from a rich Denver attorney. Now hearing is moot

I don't want to sell my home for $600k. X refuses to let me buyout his share.
No money is owing on the HELOC and the judgment liens could be avoided in part due to homestead exemption.

Finally: what the answers in this post suggest to me as a strategy is that I should file a Chapter 7 asset case...to tie the house up. If the house sells, for $600k, the trustee makes nada..but if I can persuade him that it's worth a whole lot more???????????
Is there any way that I can use the $600k contract price to Avoid the judgment liens and THEN persuade the trustee that it is worth more? Heck, even if sold for $650k, it seems taht the trustee is getting a big chunk of change making it worth her while.
I have only about $10k in assets other than the house which would be no asset(my share) unless I got the liens avoided.
There's a lot more going on here that is too much and too complicated to post....but do you think I have a chance in hell of stopping that low ball sale?
And would filing Chapter 7 be my best bet? Or would a chapter 13 do something a 7 won't (again, no unpaid debt on the house or anything.....the BK is because of the low ball sale and debts coming due upon sale)

Sorry to hijack...it just seemed that someone else (Ch 007) is in a similar sitch.

[justbroke]

ColoradoBell, that's a very complex issue. The Chapter 7 would tie it up, and you'd almost certainly end up in an Adversary Proceeding (AP) to litigate the extent of the judgment. You hit the nail on the head that the Trustee might want to be substituted or added as a party in interest. This would make it much more litigious.

Forgive me if I asked before or you mentioned it before, but you really should have a really really good real estate attorney and a bankruptcy attorney for this. It could be worth the money. There are too many issues here including, but not limited to, marital dissolution issues.

Anyhow... why are you trying to save the home? All this may be for naught.

[kw1025]

they could be grated a stay of relief..then, if it is accepted by judge, they can repossess

[ColoradoBell]

JustBroke: thanks for trying to understand my pathetic case!
I want to keep the home because it is a good investment. If I owned it myself (instead of X having 40%) I could paint it, fix some problems, and sell it for $1.5-$2 million in a couple years , and live in it til then, renting out two rooms which would pay expenses.

The sale for $600k is to a Buyer that was intimately related to X. Although there was no loan or lien on the house at the time of the divorce and it was then appraised at $1.5mil, now there is a $199k HELOC and $180k of judgement liens (from X and his attonreys against me). This is all done by power of a crooked judge 5 years after teh divorce settlement which I've never gotten a penny of. But that's another story.

If I didn't declare BK, I wouldn't even get my homestead exemption....$90k
But after I did some research I realized that MAYBE I could avoid some of those liens because of the homestead exemption. Then my family might buy out x's share at $240k (40%) and then I'd be paying off my share of the HELOC ($120k) and we'd own a house that I could fix up and market for $1.5. (I used to do real estate and know the market here well). Alternatively, if the BK trustee marketed it, it would sell for more than $600 k on an open market. (our market here just dropped 13% so we aren't as bad off as other areas)

Of course I need a good BK and RE attonrey but it is really hard to find one and harder yet to afford one because starting after July my only income is SS at $475 a month and retirement money that X still controls. HHN has referred me to some Bk attonreys he highly recommends, but for the most part, since I have no CC or med debt, I'm a really weird case that no one quite understands. I 've called at least 50 RE attoneys, gave one $3500 retainer and he took it all just to hear the issues (5 hours...and ripped off the rest) and did nothing. It's really pathetic..if you knew the whole story, all the intrigue, it would read like a Carl Hiassen novel.

So..if I declare BK before the proposed sale can close, would the proposed sale be stayed until BK was discharged?

[justbroke]

So..if I declare BK before the proposed sale can close, would the proposed sale be stayed until BK was discharged?

Until the earlier of, the discharge being entered (combined with the Trustee abandoning the asset from the Estate), the case closing, a granted relief from stay motion is entered, or the case being dismissed.

Yeah, I feel sorry that you got ripped off. It is complex, but if you did Bankruptcy, you'd have a new Judge who may be willing to hear an avoidance complaint! Would certainly tie it up for a while. However, going into an adversary proceeding can get expensive.

[angles]

oh ya.... what if the trustee takes a year to decide whether he wants to pursue the rental properties, and the market value goes up 100%? Do i have to buy back at a higher %??

I might have missed the response to this question, but can the Trustee decide a year or so later that the property has value and then take it? What about a personal home that was included in the BK? When would that be closed?

This is something that could be very important for planning purposes while filling out the petition and listing property values. If the actual value is not known, or close to what is owed, should the value be listed just below the loan amount or just above? Geesh, this is really starting to stress me out!