If I purchased property from a sheriff sale and the previous owner then claimed bankruptcy, who’s property is it?

UPDATED: Aug 8, 2012

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If I purchased property from a sheriff sale and the previous owner then claimed bankruptcy, who’s property is it?

I just purchased a piece of property from a Sheriff’s sale. A few hours later I was informed the previous owner had filed bankruptcy 30 days prior. Now, the previous owner says that he/she will sell the property to us. I don’t understand, why is the property not mine? Also, how would he/she be able to sell it to me if they claimed it in their bankruptcy? No home or homestead act.

Asked on August 8, 2012 under Bankruptcy Law, Texas


Terence Fenelon / Law Offices of Terence Fenelon

Answered 10 years ago | Contributor

The filing of a bankruptcy acts as a stay aginst the Sheriff's sale unless the creditor receibed permission of the bankruptcy Court to " lift the stay'" or to proceed withthe sale.  If there was no permission to proceed, the sale is void.

The second question is more interesting.  The property became the property of the bankruptcy estate upon filing and can only be disposed of by the trustee or the creditor in certain circumsatnces. The debtor probably has no ability to sell you the property.

You should call the trustee for the bankruptcy to determine the status of the property before proceeding.

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