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Brother declared BK7, wrote off my $50K loan I had given him to buy property. Can I cloud title?

Irvine, CA |

Part 1: He used my $50K loan to buy property. He's keeping the property & mortgages & servicing the debt, but writing off my $50K. Can I cloud title or get my name on the title? He's already filed & I've already been notified. Deadline to object is 4/4/11.

Also, he put $35K in the filing. Can I sue him after the BK for the remaining $15K?

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Attorney answers 3


I can't speak as to the whether you have a properly perfected or recorded mortgage and the implications of that under California law, but I can say that you cannot sue him post-filing for the discrepancy in the amount of debt simply because he scheduled the wrong amount. The paramount issue in bankruptcy is notice to you, the creditor, not the amount listed.

I do not practice law in California and this should not be considered legal advice.


If you do not bring an adversary action before the deadline, then you cannot cloud title or do anything to try collecting against him.


I would highly recommend that you speak to a bankruptcy attorney. It sounds like your $50,000 loan to your brother is not secured by a deed of trust on his property. So, you will have to file an adversary action to determine whether or not this debt can be discharged in the bankruptcy. Adversary actions can be expensive and it is unclear whether you would win in an adversary action.

I wonder if there is a way to work this out with your brother in a more cost effective manner. I think it is worth it for you to have a consultation with a bankruptcy attorney to see what your options really are.

Give yourself some time to get this done. You are smart to be asking this question now. After the deadline, there is really nothing you can do.
Please note that although this answer may provide information concerning potential legal issues, it is not a substitute for legal advice from qualified counsel. You should consult an attorney for individual advice regarding your own situation. Answering this question does not create any attorney-client relationship between you and Kelly Zinser, Shareholder at Olenicoff & Zinser, PC in Irvine, California. For more information on bankruptcy, please see our website.

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