file a petition to the court to force the trustee to abandon the property

[tdawg]

Has anyone here filed a petition to the court to force the trustee to abandon the property? My ch 7 is discharged, but not closed. It was discharged last month. According to pacer, the trustee is hiring a real estate agent to sell my house even though it has negative equity and I am current. My attorney has not returned my calls or emails for the last month.

I'm thinking that I either need to file a petition to the court to force the trustee to abandon the property or contact my congressman.

[BCA2009]

Has anyone here filed a petition to the court to force the trustee to abandon the property? My ch 7 is discharged, but not closed. It was discharged last month. According to pacer, the trustee is hiring a real estate agent to sell my house even though it has negative equity and I am current. My attorney has not returned my calls or emails for the last month.

I'm thinking that I either need to file a petition to the court to force the trustee to abandon the property or contact my congressman.

If the trustee thinks there is non-exempt equity, I don't believe the BK court is going to force the trustee to abandone the property. That is the trustee's job to sell property with unexempted equity. Expecting the trustee to give up in one month is probably unreasonable. There have been examples on this forum, where trustees have kept cases open over a year trying to liquidate property.

I also think contacting your congressman would be a waste of time until you have exhausted your remedies in BK court and then can show that the court is not following the law. Which as I stated above, I think you would lose.

I do understand your stress of not knowing whether or not you are going to lose your home. Did you not have any homestead exemptions to cover any potential equity in your house?

I wish you luck with whatever you try!

[tdawg]

If the trustee thinks there is non-exempt equity, I don't believe the BK court is going to force the trustee to abandone the property. That is the trustee's job to sell property with unexempted equity. Expecting the trustee to give up in one month is probably unreasonable. There have been examples on this forum, where trustees have kept cases open over a year trying to liquidate property.

I also think contacting your congressman would be a waste of time until you have exhausted your remedies in BK court and then can show that the court is not following the law. Which as I stated above, I think you would lose.

I do understand your stress of not knowing whether or not you are going to lose your home. Did you not have any homestead exemptions to cover any potential equity in your house?

I wish you luck with whatever you try!

Hi BCA,

Thanks for responding. I guess I should have explained some more detail. The mortgage on the house is for just over $395,000. I bought the house in 2008 for $395,000 with 0 down. The contract the trustee has with the real estate agent is for the real estate agent to submit offers listing the house at $395,000 until May 31, and allows the real estate agent to take a 6% commission. So, unless someone offers 10% OVER what the house is listed at, there would be no money to pay creditors with. Even if the house were to sell at what they're listing it at (which is highly unlikely), there wouldn't even be any money to pay the real estate agent with after paying off the mortgage. I'm thinking the trustee might be trying to get the bank to accept a short sale and to pay him some cash for doing it. But that seems pretty unethical to me, for him to convince them to do that when I'm current on my mortgage. What do you think? Should I just wait and see what happens?

[justbroke]

Your motion to abandon is probably not going to work. The Trustee may think that there is more than equity there. Perhaps the Trustee founds defects in the mortgage and/or promissory note. Many Trustees look for these defects, because they can then petition the court to sell the home free and clear of liens! I would see what the Trustee is actually up to. They would never sell a home where it's encumbered so much that the commissions and the Trustee's fees won't be covered.

A short sale wouldn't work in this context. Only an idiot Trustee -- and I'm not saying that there aren't any idiot Trustees -- would try to short sale and get involved in that whole mess. It makes absolutely no sense at all. Again, I'm thinking the Trustee has something up his/her sleeve.

I would just wait it out. Were you hoping to keep the home? The reason I can't understand any of this is Trustee nonsense is because if you "exempted" the home, and there's no equity anyhow, then how does the Trustee still have control? What did you list on your intentions... surrender?

[tdawg]

Your motion to abandon is probably not going to work. The Trustee may think that there is more than equity there. Perhaps the Trustee founds defects in the mortgage and/or promissory note. Many Trustees look for these defects, because they can then petition the court to sell the home free and clear of liens! I would see what the Trustee is actually up to. They would never sell a home where it's encumbered so much that the commissions and the Trustee's fees won't be covered.

A short sale wouldn't work in this context. Only an idiot Trustee -- and I'm not saying that there aren't any idiot Trustees -- would try to short sale and get involved in that whole mess. It makes absolutely no sense at all. Again, I'm thinking the Trustee has something up his/her sleeve.

I would just wait it out. Were you hoping to keep the home? The reason I can't understand any of this is Trustee nonsense is because if you "exempted" the home, and there's no equity anyhow, then how does the Trustee still have control? What did you list on your intentions... surrender?

Hey Justbroke,

Thanks for replying. I did not exempt the home because there was no equity. I listed the intention as "stay and pay". So, if he finds a defect in the mortgage, and sells the house for let's say $300,000, and my unsecured creditors get $75,000, the trustee gets $10,000 (or whatever his take is), then who gets the rest? me?

[justbroke]

I did not exempt the home because there was no equity. I listed the intention as "stay and pay". So, if he finds a defect in the mortgage, and sells the house for let's say $300,000, and my unsecured creditors get $75,000, the trustee gets $10,000 (or whatever his take is), then who gets the rest? me?

You would probably get it. In any event, yes, the "not exempted" is why it's still in the Estate and the Trustee is attempting to sell it. Just seems weird. Wish I knew what the Trustee was up to.

Should be interesting. Keep us updated!

[tdawg]

You would probably get it. In any event, yes, the "not exempted" is why it's still in the Estate and the Trustee is attempting to sell it. Just seems weird. Wish I knew what the Trustee was up to.

Should be interesting. Keep us updated!

Well, in that case, I'm rooting for the Trustee to find a defect! ;-) I'll definitely post what happens for everybody when I find out.

By the way, I do want to keep the house - unless I can get a load of cash from the trustee's shenanigans. ;-)

[justbroke]

Well, I just thought about it. The lender would just file an unsecured claim and recover some of their money. That would certainly exhaust what's left... unless you can invalidate their claim. Of course, this is all speculation.

[Mensa1]

tdawg:

Best to just sit tight here. Any move you make will serve to exacerbate the situation, at best. The odds of TT pulling this off are great and unlikely that anything will happen here. Do you have just one mtg or a 1st and 2nd?

[tdawg]

tdawg:

Best to just sit tight here. Any move you make will serve to exacerbate the situation, at best. The odds of TT pulling this off are great and unlikely that anything will happen here. Do you have just one mtg or a 1st and 2nd?

I just have one mortgage. So, I'm guessing/hoping that if they can't get a full price offer by May 31st, that they will abandon the property and close the case. So far, I have heard nothing directly from the trustee or the real estate agent, and the house is not listed yet. I'm guessing they'd need to contact me before they could.

[tightrope]

What state are you in?
What questions did the trustee ask you at the 341 meeting about the house?
Did you present to him any appraisals, BPO or a Market Analysis?
Did you reaffirm your mortgage?

If you want to keep your home, don't wait!

If you haven't gotten any valuations of your home, get some now. You can get a free market analysis done by a broker and printouts from zillow, cyberhomes, ehome.

Once you have the above valuations to back up the value of your home present them to the trustee and ask why she/he is trying to sell your home while you're current on payments and there is no equity in it.

Depending on the answer, you should definitely file a petition (or bring it to the bk judge's attention in some way), call your state AG office and your representative’s office. Fight for your home!

"A trustee should refrain from administering an estate where the proceeds of liquidation will solely benefit the trustee and the trustee’s professionals, i.e., the trustee should consider whether sufficient funds will be generated to make a meaningful distribution to creditors, prior to administering the case as an asset case."

[ben1381]

I might also suggest you seek legal counsel in this matter even if it means paying another lawyer.

[BCA2009]

I'm sorry, I guess I'm dense, I just don't get why anybody thinks the trustee has done something that you would be justified in complaining to the Judge, the AG, a congressman etc.

The house was not reaffirmed, there was no homestead exemtion applied, the trustee is obligated to act in the interest of the creditors to try and get any available assets to pay against debts owed. Being current on the payments has no bearing.

It has only been a month since discharge and the trustee has already said he only trying to sell until May 31.

Even if you think there is no equity in the house (and there probably is not).
The trustee is in no way obligated to take your word for it or your research.

If I were you I would also be stressed and frustrated, but if you annoy the trustee he might put it on the market for another 6 months just to be spiteful.

I hope the trustee abandones the property soon, but I just don't see where you have any standing to force his hand.

[Mensa1]

tdawg: I think what you probably have here is a situation where the TT has in a prior case(s) worked out a short sale with the same lender that holds the mtg/dot on your property. This could turn yours into an asset case, and result in distribution for creditors and of course TT.

I would hardly make sense to rob from a secured creditor and dist to unsecured's, which is what would result here if it shook out that way. So maybe my thoughts are off the mark here... It would be more than a little bit interesting to know exactly what the situation happens to be. Might not ever know, but if you do... please share the info.

[tdawg]

contacted by the real estate agent today

tdawg: I think what you probably have here is a situation where the TT has in a prior case(s) worked out a short sale with the same lender that holds the mtg/dot on your property. This could turn yours into an asset case, and result in distribution for creditors and of course TT.

I would hardly make sense to rob from a secured creditor and dist to unsecured's, which is what would result here if it shook out that way. So maybe my thoughts are off the mark here... It would be more than a little bit interesting to know exactly what the situation happens to be. Might not ever know, but if you do... please share the info.

I just received a Voicemail at home from the real estate agent saying that he needs me to give him a key. I really don't know what to do at this point. I don't want to jeopardize my discharge being revoked by not cooperating with him, but I also don't want to cooperate with him more than I need to. I really think what the trustee is doing here is unethical and would set a terrible precedent. Basically, if he can get away with this, then what I have read everywhere I have looked (that you won't lose your house if you're current and it has negative equity) will have to be rewritten. I emailed my attorney again, but no answer yet...