Re: Bankruptcy Question - Posted by Redline
Posted by Redline on March 14, 2000 at 24:06:04:
Once the seller declares bankruptcy a trustee will be assigned to determine all assets and liabilities and there is a 4 year “look back” window to prevent unlawful transfer of assets. They will see the home sale and will want to know if it was done to protect the asset, was it an arms-length deal, etc.
If there was alot of equity in the house that the trustee thinks they could’ve gotten through a forced sale to pay debts they can void a sale. (Remember, couples can exempt $30,000 jointly from a BC and this includes equity.)
In your case, there probably wasn’t alot of equity (?) and it was in arrears anyway so you probably wont have a problem BUT I am not an attorney nor do I consider myself an expert.