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Myth #6: It is okay to list a home even though the consumer has file bankruptcy because the attorney told you (or your client) to do so.
Reality: When a consumer files a bankruptcy petition all creditors are now prohibited from having any interactions with the borrower or their representatives. All borrower assets (including the aforementioned house) are frozen. Nothing is to be liquidated with the express approval of the trustee of the court.
Reason: All of the things stated above; additionally, it would be unfortunate for you to have a listing which is a “frozen asset” by a Federal court which someone wrote an offer on. Check the questions on your state “Seller Disclosure Form” “Is there any threatened or pending litigation?” The trustee may put the consumer into a Chapter 13 or may require they sign a deed-in-lieu. In either case, there is now no house to be sold.
Reality: When a consumer files a bankruptcy petition all creditors are now prohibited from having any interactions with the borrower or their representatives. All borrower assets (including the aforementioned house) are frozen. Nothing is to be liquidated with the express approval of the trustee of the court.
Reason: All of the things stated above; additionally, it would be unfortunate for you to have a listing which is a “frozen asset” by a Federal court which someone wrote an offer on. Check the questions on your state “Seller Disclosure Form” “Is there any threatened or pending litigation?” The trustee may put the consumer into a Chapter 13 or may require they sign a deed-in-lieu. In either case, there is now no house to be sold.
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(Please e-mail Heather at homeownershipmatters@gmail.com with any questions, comments, or concerns you might have. We appreciate all feedback, comments, and especially your questions. Don't be shy!)
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