No pre-sale bankruptcy notice is required

Kurtis,

There’s NO requirement or duty whatsoever imposed on a bankruptcy petitioner to give actual notice to any of his creditors…that he has filed a bankruptcy petition.

And that’s because the mere act of filing a bankruptcy petition in federal court AUTOMATICALLY “STAYS” or stops any continuing creditor action against a debtor, from the moment the debtor’s petition is time-stamped by the intake clerk at the court.

So any subsequent action taken by a creditor, without obtaining a relief of stay from the court beforehand (regardless if done innocently or not) is automatically null and void.

The benefit of NOT notifying the foreclosing trustee that you have filed a bankruptcy petition, just before their scheduled foreclosure auction, is that it will throw a monkey wrench into their procedure that will take them a minimum of 7 weeks to undo.

Actually, you really want the sale to take place, and then notify the foreclosing trustee the next day that it is invalid because of your earlier bankruptcy filing the day before.

That will cause them to have to cancel their invalid sale and then go through the formal process of petitioning the court for hearing (takes 4 weeks min.) to get permission to redo the foreclosure auction all over again (will take an additional 3 more weeks min)—starting with the recording of a new Notice of Trustee’s Sale.

Hope you can profit from this strategy...it's been very helpful for us.

--------------------------Ward

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