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Foreign property when filing chapter 7

Los Angeles, CA |

I'm a naturalized US citizen originally from South America. A property (a small house) in South America that was in the family was mistakenly put under my name for just a few months. The problem has been corrected. And for the past 2 weeks, it now appears under my sister's name. The property isn't mine nor can I afford the upkeep or maintenance of it and I cannot afford to travel to check up on it. Will this pose a problem for me when I file chapter 7? Will the trustee be able to track down this property if it's no longer in my name? Does a trustee automatically check to see if all bankruptcy applicant's have foreign property if they weren't born in the U.S.?

Thank you.

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Attorney answers 3

Posted

I had some sympathy right up to the point where you asked, "Will the trustee be able to track down this property ..." If you think that way, you are headed for perjury and bankruptcy fraud. You must disclose the transfer and accept whatever comes as a consequence. Be smart -- retain a bankruptcy attorney, who will properly advise you.

Asker

Posted

"I had some sympathy right up to the point where you asked" .... What a CONDESCENDING comment to make, Mr. Oney. I've been on Avvo for a while now and I've noticed a lot of your answers tend to have a negative, hostile, and accusatory tone to them which I find to be very UNPROFESSIONAL. I don't know the Original Poster's (OP's) exact circumstances, but I can tell he/she needs advise and doesn't know much about transfers of property . Perhaps the poster didn't "word" the question exactly as you would have liked, but their question is valid nonetheless. ****You didn't even ANSWER the question or EXPLAIN how this would be considered a transfer of property and that transfers shouldn't be made withing the last 12 months before filing bankruptcy.**** WHY NOT OFFER HELPFUL ADVISE? For example, in cases of car titles being transfered out of your name within the last 12 months prior to your filing bankruptcy, you could show proof that you never made a single payment on the car ever. And you'll be in the clear. But what about for house titles being transfered out of your name? See, Mr. Oney, this is where you could have helped. If the property was never really the OP's and just mistakenly placed under his/her name because he/she is in the family and the house had to go to a family member then it would be unfair and unethical to hold the OP responsible. Living in Florida, where a lot of people have family abroad, I've seen how property jumps from cousin to sister to brother to cousin because the family property must stay in the family and sometimes nobody even know's who's name it's currently under. If all you have to say is to seek an attorney and to accuse people, THEN WHY BOTHER ANSWERING ANY QUESTIONS???

Walter C Oney Jr

Walter C Oney Jr

Posted

Anyone who asks questions here needs to understand that absolute honesty is required in a bankruptcy filing. Whenever a client hints to me that they might be thinking about telling less than the whole truth, I show them the door. A question like, "How would the trustee know" is exactly that kind of hint. The courts have zero tolerance, and so do I.

Dorothy G Bunce

Dorothy G Bunce

Posted

Anonymous, I appreciate where you are coming from but you need to understand that many people posting on this site represent themselves. What they need, imho, is a bucket of cold water poured over their head to make them understand that the law isn't a game where it is okay to cheat or break the rules as long as you don't get caught. People posting on this site need to understand that there can be serious repercussions for improper actions. And I also have seen that people do not appreciate a "bar exam" answer to their question when they are headed down the wrong path. Telling them how to fix the problem may inadvertently lead them into making another mistake, one which someone with the astute skills possessed by Mr Oney might recognize, but that the poster will not. None of us is paid to participate on this site or to respond to questions. By having the courage to "tell it like it is" Mr Oney is providing a valuable service not only to the public but to the legal community. Too many consumers believe that lawyers are okay with breaking the law as long as you can find a loophole to get away with it. As officers of the court, we need to worry less about being subtle and for me, being ladylike, and worry more about telling the truth, even if it makes us look like jerks!

Asker

Posted

I have to agree with the first comment by Anon calling out Mr. Oney for his unfairness and judgementalness. First of all, I know several people who are foreign-born and I can tell you that small family homes that belonged to Grandma and Grandpa often get passed around from person to person with nobody wanting to take responsibility for a house in another country that doesn't offer much financially. Nobody wants to take care of maintaining a house or making repairs when there's not going to be much of a return on investment. It's a waste of time and money and requires travel. It's like a game of "hot potato" with nobody wanting to catch the potato or in this came house. This is VERY VERY common and it doesn't mean the OP is hiding an oceanfront mansion in Brazil. SOMETIMES A FAMILY PROPERTY ENDS UP UNDER A PERSON'S NAME WITHOUT THAT PERSON EVEN WANTING THE HOUSE. We are talking about governments in Latin America which are much more lax and don't follow as many rules or guidelines. This is why I think OP's question was valid and honest. Secondly, It's a very bad idea for an attorney to play "Judge, Juror and Executioner" in their practice and automatically assume a person is guilty of fraud because you didn't like the way they worded their question to you. So many misunderstandings and confusions occur on a daily basis due to the way people communicate with each other. So to base a person's honesty PURELY on how they communicate a question or concern to you is quite frankly unprofessional and not too mention foolish behavior. EXAMPLE: When I was in high school, I was at a doctor's appointment and I had a question about my diagnosis. So I asked my doctor "How DO YOU KNOW that ...". He didn't like the way I WORDED the question because he thought it seemed accusatory and that I was calling him an inept idiot. He blew his lid off and I ended up having to change doctors after that. In hindsight, I realize I should have asked him, "How CAN YOU TELL that ...". But it was unprofessional of him to react and judge his patient the way he did because of how a question was worded to him. I was simply, like all teenagers, not very eloquent. These types of communication issues happen with even more frequency when you cross language or cultural divides. If English isn't a person's first language (such as is the case with the OP from South America) it's very easy for a question to come across as sounding suspicious when it isn't. I think the OP wanted to know if the trustee will somehow look at her/his country's government database (if there is such a thing) for property owned and if so will the trustee be able to see the property transfer. The property is no longer in her/his name, so she should have nothing to worry about. But if the trustee can see that there was a recent transfer made it could create problems. -Jason

Walter C Oney Jr

Walter C Oney Jr

Posted

"The property is no longer in her/his name, so she should have nothing to worry about." But she does because a transfer for no consideration is potentially fraudulent as to her creditors. Maybe the trustee will pursue it or not, but she is not the one who gets to decide whether it should be disclosed. The answer is clear that it should be.

Posted

Merely holding title to a property does not make it yours. However, because it was under your name and transferred to your sister within the past 2 years, you should disclose it to the trustree and explain who the property actually belongs to and why it was under your name during the time that it was. If you can show that they property was being held for someone else who paid the taxes, collected the rent, etc. there is a good chance that the trustee will not pursue it. Also noteworthy is that a trustee may not deal with the headache of liquidating a foreign property even if he/she determined that the property does belong to you. If the property is worth a significant amount and there is little support to show that it does not belong to you (even though title was under your name), you just might not be a good candidate for bankruptcy at this time. I suggest consulting with a local attorney to evaluate your options.

Posted

Your best and safest course of action is to always disclose truthfully and honestly. If the title was under your name for only 2 months by mistake, and if you are not the owner, then you probably have very little to worry about.

You should definitely retain an experienced bankruptcy attorney to assist you on this matter.

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