Skip to main content

Foreclosure in Bankruptcy

Miami, FL |

I won a property at the foreclosure auction and a month after the sale I called inquirying about the Certificate of Title and I was advised ther will be NO title issued because the owner had filed for bankruptcy.

I have never faced this situation before. What happens next? What must I do?
Will I still be able to take posession of the house at one point? If not, will it be possible to recover the money?

Thanks for your help,

Attorney Answers 7

  1. If the bankruptcy was filed one minute before the foreclosure sale, the sale to you is invalid and you purchased nothing. Better check into getting your money back. Hope this perspective helps!

  2. Depending on the type of bk that was filed, you may be able to acquire this property for even cheaper than at the auction.

    You should get an attorney familliar with this stuff to see what they can do to get you the property.

    The above is general legal and business analysis. It is not "legal advise" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also terms and conditions item 9, incorporated as if it was reprinted here. Please visit my web site: for more information about my services.

  3. You should definitely hire an attorney in your area that is familiar with real estate and bankruptcy proceedings. It will be money well spent.

    There is no easy answer to your question without knowing a lot more information. It depends on what type of bankruptcy filing, when it was initiated, how the property was titled, etc. Please consult with a local attorney experienced in this area.

    Every situation is different and no one should rely solely on information received from the internet. If you have any questions about your legal rights, you should consult with an attorney that practices in that area of law. Nothing in this message should be construed as creating any type of attorney-client relationship.

  4. You can retain an attorney to file a Motion for Relief from Automatic Stay in the bankruptcy court to complete the foreclosure. There might be other issues if the debtor filed a chapter 13 attempting to save the property, though you could probably prevail on the basis that the debtor has no right to a chapter 13 payment plan to save the property by filing after the foreclosure sale.

    The questions and answers posted on AVVO are for general information and should not be treated as legal advice or establishing an attorney-client relationship.

  5. A bankruptcy filing imposes an immediate stay to all proceeding against the owner, which may include completing the foreclosure sale and issuing the certificate of title you are looking for. You might be able to seek a return of whatever monies you paid to acquire the property or you might eventually be able complete the sale. You are best advised to retain a lawyer to review all the facts and protect whatever interests you now have from the foreclosure auction and if necessary, to file the appropriate papers to protect such claims in the owner's bankruptcy.

  6. If you can afford to be a wheeler-dealer by bidding on foreclosure sales, then you cannot afford to be without the advice of an attorney in situations like these. In fact, the very fact that you don't know what to do with this situation tells me you really should NOT be making offers at foreclosure sales. There are many pitfalls to foreclosure sales. You could lose a lot of money and a lot of time. You may have fallen into one. However, most likely the bankruptcy petition, which is filed electronically, was filed very close to the time before the sale price was struck, and with to little time to notice the Clerk of the Court. The sale certificate is then a nullity.

    The law is complicated and although the facts expressed may seem to be all that is relevant, there may be many other important facts to consider. Also, the law is constantly undergoing change, so what may be correct today, may not be accurate tomorrow. Only a full consultation with an attorney experienced or knowledgeable in the specific legal subject matter is likely to result in the optimal course of action. My practice has entailed more than a 30 year span of many real estate, personal property, and bankruptcy issues. Find out more about me at:

  7. You need to consult an attorney. Depending on when the bankruptcy was filed, the sale may or may not be valid. Something needs to be done to sort out what rights you do or not have and what to do about that outcome. If the sale was void due to the stay, you should be entitled to a refund. If the sale was not void, the ball is in your court to move to resolve the issues.

    Please note that the above is not intended as legal advice, it is for educational purposes only. No attorney-client relationship is created or is intended to be created hereby. You should contact a local attorney to discuss and to obtain legal advice.

Bankruptcy and debt topics

Top tips from attorneys

What others are asking

Can't find what you're looking for?

Post a free question on our public forum.

Ask a Question

- or -

Search for lawyers by reviews and ratings.

Find a Lawyer

Browse all legal topics