Experience Visit http://www.bklaw.com for more information on bankruptcy in general and Mark J. Markus in particular. Many questions are answered on the web page (hint, hint). The Markus webpage also contains more information on
Education/Credentials J.D., University of Arizona 1990. B.A. Economics, California State University, Northridge 1986. For more details please click here
My mother and I bought a property together a property together, we recently sold it and we are carrying a loan for around 80.000. "The people that bought the property still owe us 80.000 and they are making payments to us of around $1500 a month. The loan is due in around 4 years."
The property is located in Washington State
My stepfather is in the hospital and isn’t expected to live that long
My mother may have to go bankrupt how will that effect the 80.000?
Thanks
Matt
ANSWER: The loan is an asset of your mother's bankruptcy estate. Whether or not it can be protected depends on the exemption laws of whatever state is applicable to her case. To see more on exemptions, please visit http://www.bklaw.com/exemptions.html. The income from the loan must also be factored in to her budget analysis and means test analysis to determine eligibility to file.
Answer That depends on what chapter of bankruptcy your mother files and, again, what exemptions are available to protect her interest in the asset. If she files a chapter 7 case, and there is equity, the Trustee can sell the Note and pay you your half, but you might get into a battle over the amount it's being sold for, since the Trustee can sell it at a discount. If she files a Chapter 13 case, the asset would have to be valued and she would have to pay out at least as much as the creditors would receive in a Chapter 7 case, but the Note would not have to be sold.
