BANKRUPTCY REAL ESTATE SALES
Specializing in residential and commercial sales involved in Chapter 7, 11 and 13 bankruptcies, Prime Equity Properties Group is uniquely positioned to provide professional real property sales representation from start to finish.
WORK WITH RECEIVER AFTER APPOINTED BY U.S. BANKRUPTCY COURT
Todd Frelinger and Prime Equity Properties Group work closely with the receivers after being appointed real estate broker to sell the real estate asset(s).
Protection/STABILIZATION of real estate asset
Real property in receivership will typically have many issues to deal with before the asset is ready for sale; including, tenant vacancies, insurance lapses or lost coverage, and deferred maintenance. We are there not only to protect and increase the value of the asset, but also to protect the estate from potential liability.
Prime Equity Properties Group is there every step of the way to provide all parties to the real estate transaction with all relevant disclosures to protect the estate from liability.
By working with the best real estate and eviction attorneys in California, we have the finest legal representation with independent counsel to evict or resolve landlord/tenant conflicts.
Prime Equity Properties Group spares no expense in providing the highest quality photography and videography available to be broadcast to all major media outlets for maximum exposure of the real property asset.
Clean-up, inventory, repairs, Donations, estate sales
You can count on us to deal with the many unknowns in real estate going through the bankruptcy process which is often in need of severe clean-up, repairs, inventory, hauling, donations, and estate sales by working with trusted vendors to complete the arduous tasks of preparing the property for sale.
Real Estate acquisition process by the US Bankruptcy Court
Below is an outline of the typical disposition process of commercial real estate through bankruptcy court’s trustee lists the asset with a real estate broker.
- Prospective purchaser submits an offer to the bankruptcy trustee’s listing agent.
- The parties negotiate the terms of the offer.
- Agree on offer and sign purchase agreement subject to approval of the US Bankruptcy Court.
- Purchaser will typically have time to do inspections, satisfy any contingencies.
- Once the contingency period is up, the Bankruptcy Trustee will file a Motion to Approve Sale with the US Bankruptcy Court (this notice must be given at least 21 days prior to the desired hearing date). Prior to filing Motion to Approve Sale, Purchaser must provide appropriate proof of financial qualification to close.
- The court will give notice of the offer to all interested parties. At any time up to and until the Judge approves the sale, any person may make a higher competing bid that could be approved by the Court. Generally, any competing bids submitted prior to the Court approving a sale will not be entertained unless accompanied by appropriate proof of financial qualification to close and minimal or no contingencies.
- At the hearing, the judge decides on an offer and issues an order authorizing the property to be sold.
- Once that order is officially entered, there is a 14-day waiting period from the date the order is entered before the closing can occur (it’s possible for the judge to approve waiving this 14-day period if desired).
- Closing takes place.
- Generally, all sales are “as is” and without recourse
- Generally, all sales are “cash at closing.”
Trustee’s role in a Bankruptcy Case
Chapter 7 Bankruptcy Case – In a chapter 7 bankruptcy case, all of the debtor’s property belongs to the bankruptcy estate unless the court makes a ruling that certain property is no longer property of the estate, the trustee abandons property to the debtor, or the property is exempt under California law from collection by creditors. It is recommended to consult a bankruptcy attorney to determine what property is exempt. A trustee is appointed to take control of certain assets of the debtor, bring these assets into the estate, and sell or distribute these assets for the benefit of creditors. Some assets will remain with the debtor if these assets are determined to be exempt from distribution to creditors. A trustee can recover certain assets that were previously transferred and bring those assets into the bankruptcy estate. Neither a debtor nor any other person or business should use or transfer an asset that belongs to the bankruptcy estate unless there is an express court order or notice from the trustee.
Chapter 11 Bankruptcy Case – If a trustee is appointed in a chapter 11 bankruptcy case, a trustee will manage the affairs of the debtor and make all decisions about property of the estate. In that scenario the trustee will perform many of the same roles as a trustee in a chapter 7 case, except different deadlines and procedures apply. The trustee has the right to propose a plan of reorganization.
Chapter 13 Bankruptcy Case – In a chapter 13 bankruptcy case, all property remains property of the debtor unless the court orders otherwise. A trustee is appointed to collect payments, monitor activity in the case and to report to the court on how well a debtor is meeting its obligations. If a debtor is not meeting obligations, the trustee can ask the court to dismiss the bankruptcy case. If a debtor’s income rises, the trustee or a creditor can ask the court to increase amounts paid to creditors.