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Here goes, Mortgage fraud, and bankruptcy

Rancho Cucamonga, CA |

I invested money with a real estate agent posing as a broker , for helping people who were losing their homes to be able to recover . I was given a Deed of Trust and a Promissory Note , neither which ever got signed or recorded . Then this person filed bankruptcy , I filed an Adversary Bankruptcy against her , things got to much for me so I hired a Bankruptcy attorney . Case is still pending , but in the mean time the D A's office tried her for fraud , I don't know what all the counts were , the case when to a hearing she plead guilty go a lessor sentence was convicted of Grand Theft and ordered to pay me restitution . My questions , can I have her served paperwork I am filing with the DER to collect some of my money back , will I be in violation of the automatic stay by doing this . Help

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Attorney answers 3

Posted

If the automatic stay is in effect, yes. Why aren't you running this question by your bankruptcy attorney? Hope this perspective helps!

Asker

Posted

I did ask him, his answer was he's not sure because the criminal restitution order under 11 U.S.C. section 362 (b) (1) indicates she would not be covered under the automatic stay, because this is a different case, than the adversary bankruptcy, so he couldnt and hasent given me an answer.

Posted

As Attorney Bunce pointed out, it is a violation of the automatic stay to "serve" documents on the real estate agent when she is protected by the bankruptcy automatic stay.

However, I assume what you meant about the "DER" is really the DRE restitution fund. I am not certain, but I don't believe you are required to "serve" or even send a copy of any of those documents to the real estate agent. I think you are only required to file the documents with the DRE. You should check on that with the DRE directly.

As Attorney Bunce pointed out - why aren't you asking your bankruptcy attorney these questions? You should be working with your bankruptcy attorney and NOT doing things without their knowledge and agreement.

Good luck.

If you need further clarity, please email me at MICHAEL@MIRELAND.US Answers to questions are for general information purposes only and do not establish an attorney-client relationship. This is not legal advice, simply information. You SHOULD NOT act on this information without consulting a competent bankruptcy attorney in your area and providing ALL relevant information.

Asker

Posted

The DRE requires the debtor be served with a copy of all documents being sent to the DRE then they have 30 days to file a response not agreeing to the application, this is because until they pay back the DRE the money it pays to me if they find my application acceptable the agent cant get their real estate license re-instated.

Michael J. Ireland

Michael J. Ireland

Posted

Contact the DRE and ask them how to proceed in this situation. You should be able to collect from the DRE restitution fund even though the debtor files bankruptcy. Good luck.

Asker

Posted

Thank you for your help, I do not see a problem with the DRE, put the agent must be served the paperwork before the application can be submitted. She goes for sentencing at the end of this month, which she will be serving time, the bankruptcy case doesn't get heard until May. I only have one year from the date she was found guilty to have all my paperwork into the DRE that also means having her served and allowing the 30 day response time she gets. With her going to prison, I don't know if I will even be able to serve her in prison, and if not I will not be able to fill the papers in time.

Posted

As the others said, be careful taking any action against the debtor while she is in bankruptcy. Penalties for violating the automatic stay can be severe. If your bankruptcy attorney can't give you the answer, then find one who can. It might be a good idea, just to protect yourself, to file a motion in the BK court for leave to bring a claim with the DRE. If you get the court's permission, then there will be no violation of the stay.

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