Real Estate Agents, in just 60 seconds you will know how to close more sales. Property sellers have many different reasons to sign a listing. But financial pressures are a leading motivator. Especially these days. The closing of your next sale may depend on what you know about bankruptcy. So here is bankruptcy made simple. These are the key concepts that Real Estate Agents should know.
Real Estate Agents – Here’s a 60-Second Lesson in Bankruptcy Basics.
The filing of a bankruptcy case creates an immediate, automatic stay. The stay is a powerful restraining order. It stops all creditor actions. Even foreclosure sales, and the IRS. The legal reason behind the stay is to preserve the assets of the bankruptcy estate from piecemeal disposition by creditors. This is extremely beneficial to the debtor. The stay may give the debtor time to reorganize, or time for a trustee to sell assets in an orderly liquidation.
Every individual person who files bankruptcy is entitled to certain property exemptions. These exemptions make various types of property “exempt” from the process of being liquidated to pay debts. Exemptions vary from state to state. Some states, like California, (where I have been a bankruptcy lawyer for 34 years) have very generous exemptions.
The filing of a bankruptcy case takes place in the Federal Courts. The case is assigned to a judge and to a bankruptcy trustee. The judge will decide matters requiring a court ruling. But most cases will sail through the legal system on autopilot. The bankruptcy trustee is an individual who makes the business decisions concerning the assets of a bankruptcy case. The trustee will abandon exempt assets back to the debtor. Non exempt assets that are worth liquidating will get sold. The trustee also has legal powers to facilitate the recovery assets that the debtor may have transferred while insolvant.
The filing of a bankruptcy case stops a pending real estate transaction. This is what makes a bankruptcy case so frustrating to Real Estate Agents. It is often possible for an experienced bankruptcy lawyer to obtain court approval for a pending transaction to be completed. This can be done when the property involved is the debtors exempt property, (such as a homestead exemption). Also when there is no equiy in the property, as with a short sale. My firm has accomplished this many times on behalf of Real Estate Agents in the Los Angeles Bankruptcy Court. The Los angeles and Souther California bankruptcy courts are my firm’s primary place of law practice.
What are you waiting for? If you have a bankruptcy-real estate question, call us. We look forward to speaking with you any time you need help to figure these things out.
Call 213-629-8801. Ask for Leon Bayer or Jeffrey Wishman.
You’re sure to like “ASK LEON” . A question and answer column. L.A. Bankruptcy AttorneyLeon Bayer answers real questions from readers. You will find it on the Nolo Publications bankruptcy blog web site. We are also found on Google+. This blog is a publication of Bayer, Wishman & Leotta. You might also like our Human Guide to Bankruptcy. Bayer Wishman & Leotta handles emergency Los Angeles bankruptcy cases. We are “The home of the free bankruptcy consultation”. You can learn more about us at http://en.wikipedia.org/wiki/Leon_D._Bayer.
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