Can a person "own" a $5000 mobile home while filing bankruptcy?

Question

A friend of mine is about to file bankruptcy. I am going to purchase a mobile home for her. Should I keep it in my name and do a virtual rent-to-own, or should I just put it in her name. I would prefer to just put it in her name but my concern is that the equity in the trailer would be lost when she files bankruptcy. I am just not familiar with how bankruptcy works. Thanks for your help!!

Answer 1

Theres several types of bankruptcy. You can elect to keep certain things. get professional help its not something to just wing.  

Answer 2

You can deed the home over to your friend after the bankruptcy is discharged. The total bankruptcy process if a chapter 7 filing takes about 4 months. If they end up in a chapter 13 payment plan, you would be best to keep in your name as the chapter 13 runs for about 5 years and the trustees look at everything, and the bankruptcy could get dismisssed if they find it in their name, without reporting it to the courts. In a chapter 13, anything that is financed has to be approved by the courts. They probably are best to ask the attorney handling their case.  Good Luck!

Answer 3

they will take any assests in bankruptcy, keep it in your name

Answer 4

Most states have what is called a homestead exemption, that protects a person’s home and up to 5K in personal property, from claims during bankruptcy.  However your situation is a little different.  I would wait for the bankruptcy to become discharged, and then deed the mobile home over to your friend.

Answer 5

Keep it simple. Keep it in your name for the time being. You can always revert it to her when some of that smoke clears up.

Answer 6

Just to get this out of the way.....don't be messing with debts or trying to hide something from the trustee and court.  

That said....and not being an attorney.....I think the rent to own would benefit her in that she can take the rent payments as an expense when calculating her chapter 7 qualifications, or in her chapter 13 payment plan.  Once the BK is discharged, deed it to her.

But seriously....run this by the BK attorney.  There are just too many rules in bankruptcy, and when each state has rules on exemptions it only complicates things worse.