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Massachusetts Agencies

Chapter 13 Bankruptcy


Chapter 13 proceedings are similar to Chapter 11 proceedings. That is, if no trustee has been appointed and a plan has been filed and approved by the court, the debtor in possession may proceed under and transact business pursuant to the provisions of the plan. If the plan permits refinancing, then the debtor in possession may give a mortgage and refinance accordingly. If a trustee has been appointed, the trustee must make the conveyance. The instrument should state, and you should establish from a review of the bankruptcy papers, that the conveyance is in accordance with the plan. Following is a check List of the things to keep in mind when taking title from a debtor in a Chapter 13 bankruptcy.

Treated much like a Chapter 11 case.

If the plan has been confirmed and includes the property and the specifics as to a sale of the same, there's no problem.

If the plan has not been confirmed or if the property is not covered by the plan there is a necessity for a twenty-day notice, (right to a hearing) and (if there's an objection) an order.

Upon confirmation of the plan, property vests in debtor, so the notice would be sent by the debtor. Make sure the trustee got notice and has no objection.

Effect on Liens and Encumbrances: None, so important to see that the encumbrances are paid out of the sales proceeds and the payoff money is not given to the debtor

Form of Deed

"John Jones, Debtor in Possession . . ."