buying after bankruptcy - Posted by Sam

import · September 30, 2003, 12:17am

Posted by JohnBoy on October 05, 2003 at 09:38:15:

The federal bankruptcy homestead exemption is $17,425. “Where a state’s homestead exemption is lower than $17,425, a debtor contemplating a bankruptcy filing should consider using the federal exemptions (if the state law permits it), all other things being equal.”

If the state law permits it?

I thought federal laws take precedence over state laws whenever the federal law exceeds the limits of a state law? I thought the only time a state law could benefit is where the state law exceeds the benefit of a federal law, but where the federal law exceeds the benefit of a state law, the federal law takes precedence over the state law? Is this not correct?

import · September 30, 2003, 12:17am

buying after bankruptcy - Posted by Sam

Posted by Sam on September 30, 2003 at 24:17:21:

I looked at a property that the guy was in 13 and it got dismissed. He is about to file ch7. Once he is out of 7 in around 4 months or so, is there any hidden dangers of buying the property then? He said he would still be willing to sell then?

import · September 30, 2003, 5:38pm

Re: buying after bankruptcy - Posted by JT-IN

Posted by JT-IN on September 30, 2003 at 17:38:39:

Sam:

No guarentee that this will be his decision. Of course this depends upon how much equity there is in the house. If there is much equity, the Trustee may sell it, which takes all decisions away from the property owner. If not, then the Trustee will release the asset from the Bk procedure, which then makes it fair game for him to sell and you to buy, without further issues… other than normal due diligence matters.

Wait to see what the Trustee does, unless the mtg. loan(s) is 85% or more of FMV, then it is a foregone conclusion that the Trustee will release the house… Still you must wait until the Trustee acts upon the release before proceeding with the sale.

JT-IN

import · September 30, 2003, 5:33am

Re: buying after bankruptcy - Posted by luke-NC

Posted by luke-NC on September 30, 2003 at 05:33:04:

depends on whether he plans on keeping his home or not. many people discharge all of their other debts, but keep the home in a ch. 7.

Now, since he already filed a 13, and now wants to file a 7, he probably is wanting out of everything, meaning he’ll sell the house to you.

Once everything is discharged, there is no danger in buying.

Thats from my experience.

import · October 1, 2003, 11:31pm

Re: buying after bankruptcy - Posted by JohnBoy

Posted by JohnBoy on October 01, 2003 at 23:31:27:

Unless the mtg. loan is 85% or more of FMV?

Doesn’t this depend on the State the property is in, assuming this is the debtors personal residence?

Doesn’t FL, for example, allow 100% exemption on a personal residence when filing a BK?

I think our State has a $7500 exemption, for each spouse when filing a BK.

Are most States simular or are there other States simular to FL that allow larger exemptions in a BK on a personal residence?

import · October 2, 2003, 7:28am

Homestead Exemption - Posted by JT-IN

Posted by JT-IN on October 02, 2003 at 07:28:56:

JohnBoy:

The roignal poster failed to mention the location of the property. I simply get tired of posting that question: “What State is the property located…?” You would think that folks would catch on to the relevance of location as it relates to state law, and the impact of their situation…

Anyway, here is some info that I found on Homestead Exemptions in various states… Yes, the exemption does impact what the Trustee is able to implement. I recently have learned about the Federal Exemption, which seems to exceed some states exemption… (listed below)…

Hope all is well…

JT-IN

Kansas, Florida, Iowa, South Dakota and Texas provide an unlimited dollar value homestead exemption

The homestead exemption is considered such a basic and important right in some states, including Florida and Texas, that it is mandated by the state’s constitution. This prevents the state’s legislature from modifying or repealing the exemption by statute.

In contrast, Delaware, the District of Columbia, Maryland, New Jersey, Pennsylvania and Rhode Island provide no specific homestead exemption.

the exemption is $5,000 in Ohio, $80,000 in North Dakota, and $125,000 in Nevada.

The federal bankruptcy homestead exemption is $17,425. Where a state’s homestead exemption is lower than $17,425, a debtor contemplating a bankruptcy filing should consider using the federal exemptions (if the state law permits it), all other things being equal.