I have equity in my home. I’m a little worried that the Chapter 7 Trustee’s
going to want to sell my home. Now, when I have the trustee review the information
about my mortgage and my exemptions, can I also make him deduct costs of sale so that
I don’t lose my home in Chapter 7? My name’s Ron Drescher. I’m an attorney practicing bankruptcy and
creditors’ rights in Maryland, Delaware, Pennsylvania and Virginia. and this is a tricky question because legally
you’re not entitled to deduct costs of sale as what is really like an additional exemption
for your homestead in Chapter 7. It’s not really permitted. On the other hand when the trustee looks at
a home and analyzes, well you’ve got a homestead exemption under state law and you’ve got a
mortgage that needs to be paid off and, you know, and I’m going to have to pay closing
costs because as the trustee, I’m going to have to make, you know, those payments at
settlement, then the trustee’s going to have to take those into consideration when he or
she decides whether or not to sell your home in the bankruptcy case. So, sometimes there’s a little tussle and
a little give and take with the Chapter 7 trustees because they don’t like the fact
that you’re deducting costs of sale in your presentation to the trustee of your assets
but the bottom line is the trustee has to pay costs of sale if he chooses to sell your
home. So, there can be a little bit of a standoff
but you’re not automatically entitled to reduce the purchase price by costs of sale but it’s
going to be a thing that will likely work in your favor. My name is Ron Drescher. I’m an attorney practicing bankruptcy and
creditors’ rights. If you have a question of whether you’re going
to be able to keep your home in Chapter 7, please pick up the phone and call me. I would love to hear from you.