I received a call from a lady yesterday who is filing bankruptcy and wants to sell her house quick so she can just start over. I am wondering what the best course of action is. I'm not sure if buying "subject to", trying to get a lease option, or offering a lower cash price is such a good idea in this case. Don't some sales have to be approved by the bankruptcy lawyer?
I have not spoke with her yet, but did leave her a return message. I just want to make sure I know what I'm getting myself into before I talk to her.
you need somone on your team who understands MA laws RE bankruptcy. In some states you cant buy a house when the seller has filed. Also you need to know about leins and mortgages at the very least. I would start by asking a lot of questions of the seller.
to your success
Every state is different, but usually bankruptcies put a hold on things. That being said, it doesn't mean the deal is dead, just that you will probably have to wait on this one. Of course, if you can buy her house before she files bankruptcy, then there's no problem.
You are wise to ask these questions now. The first step is to determine whether this person has actually filed for bankruptcy. If he/she has, then any sale would have to be approved by the bankruptcy court or wait until the case is concluded. In a no asset chapter 7, that would be about three months start to finish. A chapter 13, however, could be five years.
I assume that this is an arm's length transaction; not a relative or a business partner. These "insiders" can more scrutiny. Otherwise, the sale is pretty straightforward. But again, if you go to contract, and the sale does not occur before the bankruptcy filing, you are looking at some delay. The best case is to complete the sale after the bankruptcy case is closed.
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