Q: In chapter 7 can they force a sale of a home you are only part owner of?
5 of us inherited a $150k home from our father. 4 of us are living in it and one of us living there wants to file chapter 7 bankruptcy on $60k worth of debt. None of us are in a position to take on a loan payment to buy the one out. Will they make us sell the house to get their 1/5 share of it?
A: He can claim an exemption for his $30,000 share of the property. Depending on whether you use state or federal exemptions, he may be able to exempt most of his share and protect the property from sale.
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A: It will depend on the equity owned by the sibling filing bankruptcy and the homestead exemption available to them. 1/5 of $150k is $25k, so as long as the homestead exemption in the state they live in offers $25k (or if they can use a wildcard exemption if available), it should be ok. Your sibling should hire a bankruptcy attorney to confirm this. Otherwise, it will depend on the Trustee appointed, but yes they could force the sale if there is equity.
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