Kennedy, No. 09-64432-fra7 (Bankr. D. Oreg., January 19, 2011)
When you file for bankruptcy, who receives your home depends on a lot of factors. You may get your home if it falls under certain laws, called exemptions. Your creditors may receive it if they have a mortgage on it with what is called priority, meaning that they stand first in line.
In this case, Mildred Schoor had sold her home to a real estate agent, who promised that she could live there until she died (she was 85). In exchange, she sold the home for less than half of what it was worth. But when the realtor filed for bankruptcy a few years later, she discovered that the real estate agent had sold her home to another person, who had no idea she was living there or that she was expecting to live there until she died.
When this new purchaser tried to get her home, she tried to establish priority in the home. The court agreed with her, that her interest in living in the home came before the new purchaser’s right to possess the home. This was because, although the new purchaser had no knowledge of her interest in the home, it would have been easy for him to find out about it. After all, all he had to do was go to the residence and he would see someone was living there.
It is important to have everything lined up and planned out before you file for bankruptcy to ensure that your assets are safe. Take advantage of a free consultation with a Tucson bankruptcy attorney to get your questions answered and your options discussed.
Stephen M. Trezza