Question: Hi,
Co signer on vacant land, ex claimed bankrupcty. Trustee is stating I am responsible to pay for the evaluation of the property and the arrears and then pay the equity in the property. I dont’ understand if I pay the arrears why does the bankrupt get my money and also why I am solely responsible for the costs associated to selling or purchasing this property. I have people willing to buy for the balance of the mortgage. Is this not fair as then all his debt and my debt is cleared?
Answer: It’s impossible to fully answer your question without more information, but here’s a simple explanation: One of the trustee’s jobs is to turn the bankrupt’s assets into cash. If the bankrupt has equity in the property, the trustee proposes to have you purchase that equity. Those funds then go into the bankrupt’s estate, and are distributed to the bankrupt’s creditors. The bankrupt doesn’t get the money.
We suggest you discuss this directly with the trustee. If you are not satisfied with the explanation you get from the trustee, you should discuss it with a lawyer who can advise you on how to protect yourself in this situation.