Quit Claims
If a property is Quit Claimed while in bankruptcy can you still proceed with the transaction, and if not what is the best coarse of action?
If a property is Quit Claimed while in bankruptcy can you still proceed with the transaction, and if not what is the best coarse of action?
A quit claim grants any "right, title, or interest" that the seller may have to transfer. A person in bankruptcy is unlikely to have any right to transfer title, in which case the quit claim deed transfers nothing.
I suggest dealing through the bankrupy trustee. However, if the property survives the bankruptcy still in the hands of the seller, your quit claim deed may be a valid transfer.
Chris
Good reply, Chris. I agree.
The Bankruptcy Trustee needs to release the property before ownership can be transferred.
[addsig]
An LLC is an additional layer of protection, but particularly a single member LLC can be pierced and you could be found personally liable.
Chris
It may work, but is it worth the risk?
Say you have a $5M apartment building in the LLC. A tenant falls off the 2nd story balcony, and dies.
Her estate wins a 2M judgement against the LLC.
Was loosing 2M in equity (+legal fees) "worth" paying say 5000/yr for the policy?
FYI: Kemper/Unitrin will allow you to add a single member LLC to a personal umbrella policy as an additional insured, which I thought was pretty cool.
Thank you all very much for the great advice!
My atty said to avoid it as well. His primary concern in my situation was the DOS clause in the primary note.
Thanks for the reply!