I Inherited Property with Someone Else and Now They are Filing Bankruptcy
Hi, my name is Wayne Mortensen and I am a bankruptcy attorney in Tucson Arizona.
I wanted to talk today about co-owned property being sold by the trustee free and clear of liens. Here is the scenario. Sometimes people will come in and mom and dad will have left two brothers a piece of land down in Sierra Vista Arizona. The brothers come in and one of them files bankruptcy and the other one doesn’t because he is doing fine, but the land happens to be worth $50,000. When you file bankruptcy, that asset is going to be sold by the trustee unless that brother that did not file bankruptcy buys the interest of the trustee out. If that brother does not come and make an offer and deal with the trustee directly and buys that interest out, the Trustee has the right to go and sell that property and then give to the brother who is not in bankruptcy, the 50% share he is entitled to.
Now this might sound really great, but guess what? The trustee in most instances, do not care how much they sell assets for. They would like to maximize for the estate, but believe me, if it was a $50,000 asset and the trustee got $30,000 offer, from one or two people, they would willingly accept that and then pay the brother, not filing bankruptcy, $15,000 after fees and costs have been paid.
You have to be really careful when you co-own property. You have to understand what the trustee’s rights and responsibilities are and what your rights and responsibilities are. We would love to advise you on this if you have co-owned property and you think you might have those issues.
Please give us a call. Come into the office, sit down. We would love to be able to talk to you about this. Again, my name is Wayne Mortensen and I am here in Tucson Arizona. Please give us a call.