Pre-Bankruptcy Short Sale...

[agkatz]

If I do a short sale on a home, but the sellers are planning to do file a bankruptcy soon... are they any concerns I should be aware of?

- A.

[Admin]

AK,
Part of the concerns stem around whether the seller plans to file a 13 or 7 and the timing of the filing.

Rather than going into the few things I do know, I'd suggest talking directly with their attorney.  Frequently, I've had to do this as the seller doesn't understand the ramifications of various actions.  Also, I've found I get better information this way typically.  I have had it happen on occasion that my knowledge of the creative real estate combined with bankruptcy activities seemed to be higher than the attorney; not often, but it's still scary.

[tedjr]

If you close on the sale before they file there should be no problem. In a chapter 7 case the trustee will not try to reverse a sale if there is no equity to start with. Why would they file anyway if their house is usually the biggest asset and usually the only reason for filing. If they file first you may still be able to buy thru the court but that will take longer. Hope this helps a little

Thank you,

Ted P. Stokely Jr
11505 Sw Oaks
Austin, Texas  78737

512-301-9171 home
512-587-6177 mobile