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Asked in San Diego, CA Jul. 26, 2015 ,  9 answers Visitors: 23
My Chapter 7 Bankruptcy was discharged in January 2014, but I am still waiting for it to actually close.
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9 Answers

Anonymous
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Posted on / Jul. 31, 2015 18:31:53

As you have discovered, if you have an asset case, it can take years for the trustee is liquidate the assets, and distribute the funds to creditors. Until those things happen, your case will not be closed. Without knowing the facts of your case, there is nothing more for you to do since you have received your discharge. So, breath easy.

Anonymous
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Posted on / Jul. 30, 2015 20:26:05

There is much that might be going on your case. A case does not close until after discharge and after the Trustee has concluded whatever he/she is doing in the case. If you can't get a response from your attorney, perhaps you should seek a consultation with another attorney who can review the case and find out specifically what is occurring.

Anonymous
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Posted on / Jul. 29, 2015 19:03:49

It is not clear from the facts you gave in your question, but you may be in serious trouble.

Home price appreciation while the chapter 7 case is pending is property of the BK estate. That means that if your house was worth $400,000 on the day you filed for BK, and since that time it has increased in value to $450,000, that additional $50,000 can be liquidated by the trustee as property of the BK estate. With the way home prices are going in California right now, most homes have increased in value since 2014.

This is one of the more disreputable tactics trustees use, but they will often leave a case open for extended periods to in order for this price appreciation to occur, then swoop in and try to force a sale of the house to get the increase in value.

You MUST consult an attorney asap. If your current attorney is not responding, fire them. Get a new one. What is needed is a motion to compel abandonment. This has to be filed to force the trustee to abandon the home as an asset of the BK estate, and prevent the scenario I described above. Do this right now - house prices in California are increasing 1-2% per quarter. That could be a lot of money, and you risk losing your home.

You should consult an attorney to handle this. Any non-exempt property will be seized and sold by the chapter 7 trustee, so doing this case yourself could result in the loss of a great deal of your property. Don’t take that risk.

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Disclaimer: The materials provided in this answer are informational only and should not be relied upon as legal advice. It is always best to seek the advice of an experienced attorney.

Anonymous
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Posted on / Jul. 27, 2015 16:24:22

Trustee may keep case open while he/she completes analysis and investigation.
Consult your attorney regarding homestead and tax issues.

Anonymous
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Posted on / Jul. 26, 2015 15:42:33

You should probably sue your lawyer your malpractice. Of course, I am just being facetious but that ranks up there with you filing a bar complaint merely because your lawyer is not a responsive in repeating that you have nothing to do in your case. That is probably accurate, and if there comes a time for action your lawyer will no doubt promptly inform you. A certified letter means you spend time and money instead of picking up the phone and calling and firmly asking to speaking with the lawyer. Given that something could happen in your case, if you want to make sure things are strained later with your lawyer, file a bar complaint. None of this is to say you are wrong in thinking the lawyer could and should communicate more, but you don't post anything to indicate the conduct is egregious or that it can't be resolved with some persistence on the phone.

Anonymous
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Posted on / Jul. 26, 2015 12:21:37

Perhaps your attorney didn't do the best job explaining how bankruptcy works, but I strongly disagree with my colleagues that have suggested complaining to the State Bar. The attorney's job seems to be complete now that you have your discharge.

A bankruptcy will not close until all assets have been administered (sold and money paid to creditors). The fact that your Chapter 7 trustee hired an accountant indicates to me that your case had assets. It can take YEARS for the trustee to sell the assets and paid creditors. I had one case of my remain open for over 5 years.

Most Chapter 7 cases in San Diego have no assets and close about 9 weeks after the meeting of creditors. You case will remain open a while longer and amount of time is in the hands of the trustee. Your attorney will likely have no way of know how long this process will take.

The most important that is that you have your discharge and most debts are forgiven.

Anonymous
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Posted on / Jul. 26, 2015 06:01:43

The most important date for you is the date of your discharge. That is the date that allows you to start rebuilding your credit. Depending upon the assets that the trustee is dealing with and the length of time it takes to liquidate those assets, an estate can be open a long time. This is especially true if a major part of the nonexempt assets is a lawsuit that must be tired or settled before distribution can be made to creditors and the case can be closed.

If your contract with your attorney contemplated issues like this and the contract provided that your attorney would charge additional fees for post discharge work relate to an asset case, then your attorney could charge you for the time spent explaining what is happening. I don't know if that is the case, but the agreement between you an your attorney should control what he/she should do at this point and whether he/she can charge additional fees.

In one way, your attorney is probably right, because you received your discharge and the discharge cannot be set aside if more than one year has elapsed since the the discharge order was entered. If the trustee has take charge of all the assets that are nonexempt, then nothing that is happening now should have an effect on the exempt assets that you retained or any income or assets that you have acquired or will acquire.

If you feel like you need additional advice, you can seek a second opinion. Most bankruptcy attorneys will provide you with a free initial consultation.

Anonymous
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Posted on / Jul. 26, 2015 05:16:53

I concur with the recommendation of my colleague atty Deasy. Attorneys do not like hearing from the State Bar.

Anonymous
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Posted on / Jul. 26, 2015 04:49:50

Send your attorney a certified letter asking for guidance. If they do not respond, show up at their office and demand a meeting. If that does not work, call the state bar and file a grievance.

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