What to do if I know someone who has filed for Chapter 7 so is not allowed to have any assets in their name for several more months, however they want to buy a house?

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What to do if I know someone who has filed for Chapter 7 so is not allowed to have any assets in their name for several more months, however they want to buy a house?

He has found a house he would like to mortgage and make payments on (he has enough money to make the house payments) but because of the bankruptcy he can’t put the house in his name. Would it be legal for him to put it in my name, yet for him to make the payments, and for it to be transferred once the bankruptcy ends? I know it is bankruptcy fraud to put assets in other’s names before filing, however I’m not very clear on the legality of doing it while bankrupt.

Asked on February 28, 2013 under Bankruptcy Law, Nevada

Answers:

Richard Van Dyke / Van Dyke & Associates, APLC

Answered 8 years ago | Contributor

Post-Petition earnings are not property of the Chapter 7 debtor's estate, therefore if the debtor wishes to purchase a piece of real property and secure a mortgage to do so with his or her post-petition earnings there is no legal barrier to doing so. 

Richard Van Dyke / Van Dyke & Associates, APLC

Answered 8 years ago | Contributor

Post-Petition earnings are not property of the Chapter 7 debtor's estate, therefore if the debtor wishes to purchase a piece of real property and secure a mortgage to do so with his or her post-petition earnings there is no legal barrier to doing so. 


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