CA-Trying to keep home....please help

[LiveStrong]

Hello everyone and thanks for all the usefull info...I have been lurking for weeks. Here's my situation:
I am considering a chapter 7 filing with 120k in unsecured debt....I haven't been late on anything as of yet, I'm just not making much money and running out of cash / savings fast. I'd just like to walk out of this with my house.

Okay, I had my home appraised 5 months ago and it appraised for $459,000 I'm in southern california and values certainly haven't gone up in the last 5 months. Since having it appraised we have started a bathroom remodel...2 of the three bathrooms including the master are torn completely apart (no flooring, cabnetry, bathtub, toilet, etc) We have a back yard remodel going as well. (1,500 sg ft of pavers about 1/3 finished) I've just learned that my entire septic system needs to be replaced. (approx $12,000) I owe $280k on a first and an equity line. I know that my wife and I are entitled a 75k homestead exemption if filing together.

Here's where it gets tricky; I borrowed 98k for a business venture from a very well off friend of mine on 5/11/2007; I issued him a deed of trust on my property for the 98k, we had it notorized on 5/11/2007. He never recorded the deed, he's really not that concerned about the money. So here's my big question; should I have him go record that deed now? With that recorded it will eat up any equity that may remain in the house. Also, would or could the court trustee attempt to lift the recording even though it was notarized 2+ years ago? Would recording two years after the fact nulify or supercede the notarized date of the document in any way in the eyes of the trustee?

I know I need to consult with an attorney...I was just wondering if any of you have gone through something similar....or would care to share some advice.
Thanks in advance!

[2manybills]

Boy - everyone is So. Cal. must be appraising at $459K lately. That's exactly where ours came in at!

Here's another thing, do you need to show the secured payment on your schedules to qualify for the Chapter 7? All secured payments can be used to qualify for the means test and for your Schedules I and J.

[LiveStrong]

Boy - everyone is So. Cal. must be appraising at $459K lately. That's exactly where ours came in at!

Here's another thing, do you need to show the secured payment on your schedules to qualify for the Chapter 7? All secured payments can be used to qualify for the means test and for your Schedules I and J.

Sorry to sound ignorant...."secured payment on your schedules"?
Not sure what this means...

[2manybills]

When you file your petition, there will be a Schedule J, which will list all of your monthly expenses now. You can include all of your secured payments on there, as you will not want to have much disposable monthly income left (DMI), if any, in fact, most people would say to show a negative DMI.

[keepmine]

Not recording the deed {perfecting the lein} is big trouble. You absolutely need to let your lawyer know about this. The trustee could well snatch your friends interest in the equity in your home.

Do search for some posts from one of our mods-Minnymouth. Her mortgage company failed to record the deed and she lost her home to the trustee. In the last month or so, another poster had a similar experience when a family member who loaned him money to buy a car didn't perfect the lein.
I'll tell you right now, you no longer have a routine, run of the mill bk.

[LiveStrong]

When you file your petition, there will be a Schedule J, which will list all of your monthly expenses now. You can include all of your secured payments on there, as you will not want to have much disposable monthly income left (DMI), if any, in fact, most people would say to show a negative DMI.

Okay, got it...that shouldn't be a problem for me.

[junker]

i was talking to title co the other day..they told me its all about position of liens...ie.. if its going to be a while before you file and you get judgements of any kind...and they are filed BEFORE your friends note.... they will have to be paid before your friends second note... unless he gets it registered first...so i would encourage him to get it filed....having lived in so cal quite a few years ago.. if it can be done they can do it down there.. they have the most creative financing i have ever seen...almost seems like you can get 100 year financing with no down....

[LiveStrong]

Not recording the deed {perfecting the lein} is big trouble. You absolutely need to let your lawyer know about this. The trustee could well snatch your friends interest in the equity in your home.

Do search for some posts from one of our mods-Minnymouth. Her mortgage company failed to record the deed and she lost her home to the trustee. In the last month or so, another poster had a similar experience when a family member who loaned him money to buy a car didn't perfect the lein.
I'll tell you right now, you no longer have a routine, run of the mill bk.

Hmmm, I haven't filed for bk yet.
So long as the deed of trust is recorded prior to any bk filing shouldn't I be okay? My understanding is that 'recording' is simply a way to give public notice and not recording doesn't mean that the agreement or the deed of trust in this case doesn't exist right? Remember, we notarized the deed over two years ago. He can record it at any time right? Their is no time statute to record a deed is their? ...obviously I will have him record it prior to any filing.

Thanks again!

[2manybills]

I would think so. I would definitely consult with a good attorney before doing anything. He will be able to tell you how to have things done properly to prepare yourself for Chapter 7 filing.

[LiveStrong]

I would think so. I would definitely consult with a good attorney before doing anything. He will be able to tell you how to have things done properly to prepare yourself for Chapter 7 filing.

Hmmm.....a good attorney? Are their any of those? haha....It seems like they all have a different opinion and their own agendas....You know, ask three attorneys the same queston and get three different answers. Thats been my experience with attorneys...unfortunately. Can't live with em'...can't live without em'.

[2manybills]

Sadly I know that's been the experience of so many people. I fortunately or maybe not, have worked in the legal field for over 30 years and have the privilege of working for attorneys that have integrity (yes, there are some!). Fortunately, my attorney for the BK is a long time friend of mine, and he truly cares about his clients and obtaining the best outcome possible for them.

[LiveStrong]

Sadly I know that's been the experience of so many people. I fortunately or maybe not, have worked in the legal field for over 30 years and have the privilege of working for attorneys that have integrity (yes, there are some!). Fortunately, my attorney for the BK is a long time friend of mine, and he truly cares about his clients and obtaining the best outcome possible for them.

Good for you, I'm glad you had someone you could truly trust. Do any attorney's ever post here?

[2manybills]

Not that I've seen. I think most BK attorneys, at least in LA Central District, actually probably the whole country, don't need to do much advertising. They are so busy. I would try to find a referral from the State Bar and maybe go to 3 or 4 local attorneys for a free consulation.

Also, you might post on this board for your area and someone could send you a private message if they had an attorney that was really awesome in your area.

Good luck to you.

[LiveStrong]

Does anyone else have any input regarding my original post?
In a nutshell my question is this:
If my friend went and recorded the deed now, two years after executing and notarizing would or could a trustee consider the recording to be an attemt to defraud creditors and try to lift or void the recording?

I've heard of peolpe running out and transferring property just prior to a bk filing and trustee's 'unwinding' such transfers citing 'fraudulent transfer'. I don't think my issue falls in that category considering the deed was executed and notarized two years ago but I want to make sure....THANKS!

[keepmine]

You just need to get some legal advice.
The problem you may have is, the UCC requires a lein to be perfected within either 20 or 30 days of funding the loan {forgot which one}. I'm not sure when it was notarized has any bearing.
The few experiences that posters have shared on this site about this issue have all ended badly for the bk filer.