Re: bankruptcy and joint owned home
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Posted by Why Chat (220.127.116.11) on September 27, 2002 at 19:21:31:
In Reply to: bankruptcy and joint owned home posted by l'casse on September 27, 2002 at 02:23:59:
I do not know how your home is titled,however, I DO know that you AND your brother should sit down with a lawye and work out a solution to your problems.
Normally speakng, in a ch7 BK a secured loan on a homestead is just reaffirmed,however with a joint ownership that is NOT "of the entireties" as would be with a married couple, the equity COULD possibly be a problem in a BK and the trustees (not the creditors) COULD possibly force a sale.
However, the value of the house, and it's equity are not figured by fair market value, but by "distress sale" or "sheriffs auction" price. Plus the added costs of sales and brokerage fees are taken out, then the trustee would have to be SURE that there would be enough to pay off the mortgage,then refund the 1/2 equity to your brother, and YOUR exempted amount,which in Cal. is $50,000 for a single person.
Giving the presumed equity EVEN at 100% for a sheriff's sale, Your brother is entitled to $75,000,the sales costs are deducted -probably 5% of the TOTAL sales price,and - your $50,000.it still looks to me like a negative number. So, in my OPINION, you have nothing to fear, BUT you still need to sit down with your brother and a lawyer to make sure.
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