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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Is Ch. 7 Filing A Deal Breaker? Posted by Gary on May 26, 2001 at 7:34 AM Need some expert advice. I had a deal until the seller talked to his lawyer. Here's the situation: Seller is going to trustee sale on June 4th. FMV of 10 year old house is $350k. Total liens are the foreclosing 1st TD ($150k), 2nd TD ($20k) and IRS lien ($20k) totaling $190k. Initially agreed to sell to me at $251k. After talking to his lawyer, the seller was advised not to sell to me but to file Chapter 7 to wipe out the debt (including $10k in credit card debt) and receive up to $75k equity homestead protection. How does this homestead protection work (is there a reference I can read?)? Is this possible (i.e. can he make $75k out of this)? How does he collect this equity....from the foreclosure sale proceeds after the lienholders are paid? My understanding is that he can get whatever is leftover after the lienholders are paid without this protection. So I'm not sure of the benefit of the homestead protection. Foreclosure sales prices here in California, I believe (I've never been to a sale), are about 70-80% of FMV, which is about what I am offering to him anyway. The seller is taking the long weekend to mull over his options. He may still sell to me but given no additional info, if it were me, I would go with my lawyer's advice, not a buyer like me who wants to make a buck. I'd appreciate any thoughts or arguments on how it would be better for the seller to sell to me over any other options he may have and on how I can make this deal happen. If filing Ch. 7 is the best option rather than selling to me, I'd like to know that too. Thanks, Gary Follow Ups: Re: Is Ch. 7 Filing A Deal Breaker? Ward-CA- 8:50 AM, 05/26/01 (2) Re: Is Ch. 7 Filing A Deal Breaker? Gary 9:32 AM, 05/30/01 (0) Re: Is Ch. 7 Filing A Deal Breaker? Gary 10:48 PM, 05/28/01 (0) Post a Followup: Name : E-Mail : Subject : Comments: : Need some expert advice. I had a deal until the seller talked to his lawyer. Here's the situation: : Seller is going to trustee sale on June 4th. FMV of 10 year old house is $350k. Total liens are the foreclosing 1st TD ($150k), 2nd TD ($20k) and IRS lien ($20k) totaling $190k. Initially agreed to sell to me at $251k. After talking to his lawyer, the seller was advised not to sell to me but to file Chapter 7 to wipe out the debt (including $10k in credit card debt) and receive up to $75k equity homestead protection. How does this homestead protection work (is there a reference I can read?)? Is this possible (i.e. can he make $75k out of this)? How does he collect this equity....from the foreclosure sale proceeds after the lienholders are paid? My understanding is that he can get whatever is leftover after the lienholders are paid without this protection. So I'm not sure of the benefit of the homestead protection. Foreclosure sales prices here in California, I believe (I've never been to a sale), are about 70-80% of FMV, which is about what I am offering to him anyway. : The seller is taking the long weekend to mull over his options. He may still sell to me but given no additional info, if it were me, I would go with my lawyer's advice, not a buyer like me who wants to make a buck. : I'd appreciate any thoughts or arguments on how it would be better for the seller to sell to me over any other options he may have and on how I can make this deal happen. If filing Ch. 7 is the best option rather than selling to me, I'd like to know that too. : Thanks, : Gary Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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