Can my SDIRA file chapter 11 bankruptcy?

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Just curious-- my checkbook controlled LLC owned by the IRAs of multiple family members acquired a rental property in WA state which is in forclosure. The former owner and signor on the loan gave it to our LLC via quit claim deed. So now he's on the line for the loan buy my SDIRA owned LLC is the owner on title. We intend to sell the property to pay off the loan and reap the equity, but if timing goes sideways, could our LLC file chapter 11 BK to stall the sale? I figure the answer is 'no', but thought I'd put it out here for any of the IRA experts to opine

Originally posted by @Bob Malecki :

Just curious-- my checkbook controlled LLC owned by the IRAs of multiple family members acquired a rental property in WA state which is in forclosure. The former owner and signor on the loan gave it to our LLC via quit claim deed. So now he's on the line for the loan buy my SDIRA owned LLC is the owner on title. We intend to sell the property to pay off the loan and reap the equity, but if timing goes sideways, could our LLC file chapter 11 BK to stall the sale? I figure the answer is 'no', but thought I'd put it out here for any of the IRA experts to opine

If you file bankruptcy it would probably stall the sale as you suggest but the bank will probably exercise the "due on sale" clause. Also, the court takes over the entire estate and has control on how it is disbursed. You can't sell a property while under bankruptcy protection with out a court order. The trustee will determine how much it is valued at, they will get a 7% fee of the gross proceeds in addition to the realtor fee of 6%.  There are other variables but I suggest you avoid that route. Find out how much to bring the loan current, even if it's borrowed money and pay it. You then have the option of doing with it as you please. It's better for everyone involved, by far.