Q: If my chapter 13 bankruptcy gets dismissed can trustee take my real estate even though it’s not included in the case?
I agree with my colleague's terse answer, but there seems to be a common misunderstanding about what assets and debts are "included" in a bankruptcy case.
You have no choice about which assets or which debts. Your required Schedules of assets and debts, filed in every case, show all possible assets and all possible, even if disputed, claims/debts. Everything goes in, some things come back out, and those things are determined by what your state law/bankruptcy says are "exempt assets". You can google this item in your state.
You must show each exempt item on your Official Schedule C filed in the bankruptcy case. If a trustee or any creditor objects to any of your claimed exemptions, that will trigger a hearing in the bankruptcy court and the assigned judge will decide.
Given the foregoing, however, you raise an interesting point- is a subsequent Ch. 7 trustee bound by choices made by a preceding Ch. 13 trustee? That answer is probably yes, but individual courts may differ.
A: In Alabama, if your Chapter 13 bankruptcy case is dismissed, the trustee's ability to take your real estate largely depends on whether the property was included in the bankruptcy case. If your real estate was not part of the bankruptcy case, it typically remains outside the scope of the trustee's authority. However, any pre-existing liens or claims against the property may still be applicable. It's crucial to understand that the automatic stay protection, which prevents creditors from taking collection actions during an active bankruptcy case, is lifted after dismissal.
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