Is it legal to sell your property to a friend or family member then file bankruptcy then have it returned to you in time? 16 Answers as of April 07, 2017

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Law Office of Susan G. Taylor
Law Office of Susan G. Taylor | Susan G. Taylor
Transactions to insiders are closely scrutinized; you must sell for fair market value, or at least liquidation value (a bit less than fmv). A trustee can easily set aside any transaction completed within 2 years of filing.
Answer Applies to: Texas
Replied: 4/7/2017
Marc S. Stern
Marc S. Stern | Marc S. Stern
NO! It is called bankruptcy fraud. It is a felony and you can be sent to jail for doing it.
Answer Applies to: Washington
Replied: 4/4/2017
Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
It is entirely illegal. There are both criminal penalties and the loss of your discharge if you try it. Do not even think of it. Instead consult an experienced reputable lawyer who might be able to help you achieve your goals lawfully.
Answer Applies to: Wisconsin
Replied: 4/4/2017
Patrick W. Currin, Attorney at Law | Patrick Currin
No, this is called a fraudulent conveyance.
Answer Applies to: California
Replied: 4/4/2017
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
ABSOLUTELY NOT.
Answer Applies to: California
Replied: 4/4/2017
    Bird & VanDyke, Inc.
    Bird & VanDyke, Inc. | David VanDyke
    Absolutely NOT! All prior transfers of assets must be disclosed in your bankruptcy filing. Any property that you transferred prior to bankruptcy without adequate consideration will be considered a fraudulent conveyance. The trustee has the power to set aside such a transfer and liquidate the asset to pay creditors. You may also be denied a discharge. Your best bet would be to consult with a knowledgeable bankruptcy attorney before you do anything.
    Answer Applies to: California
    Replied: 4/4/2017
    Danville Law Group | Scott Jordan
    No, what you propose is called Fraud.
    Answer Applies to: California
    Replied: 4/4/2017
    Eranthe Law Firm
    Eranthe Law Firm | Cate Eranthe
    It sounds like the answer to your question is no but it's hard to tell what you are asking. You can sell items before filing a bankruptcy case if you receive the fair market value for the property and disclose the transaction in the case that you file. If you are trying to transfer property to get it out of your name before filing and then have it given back to you - that is not okay and sounds like fraud which can land you in prison. The key is to be fair. The overarching principle in bankruptcy is fairness. If you are trying to cheat your creditors or the court you are in for trouble. The best thing you can do is go see a local knowledgeable bankruptcy attorney for a consultation.
    Answer Applies to: California
    Replied: 4/4/2017
    GARCIA & GONZALES, P.C.
    GARCIA & GONZALES, P.C. | Richard N. Gonzales
    Yes (although "illegal" is not the correct terminology).
    Answer Applies to: Colorado
    Replied: 4/4/2017
    Charles Schneider, P.C.
    Charles Schneider, P.C. | Charles J. Schneider
    It would be a fraudulent conveyance.
    Answer Applies to: Michigan
    Replied: 4/4/2017
    CARL C SILVER ATTORNEY AT LAW
    CARL C SILVER ATTORNEY AT LAW | Carl C Silver
    If you don't get caught.
    Answer Applies to: Michigan
    Replied: 4/4/2017
    Stephens Gourley & Bywater | David A. Stephens
    It's legal if they pay fair market value. Otherwise, the sale can be set aside by the trustee.
    Answer Applies to: Nevada
    Replied: 4/4/2017
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    That is usually referred to as a fraudulent transfer, and a bankruptcy trustee can pursue all parties to this transaction. The court can impose penalties, both civil and criminal.
    Answer Applies to: Nevada
    Replied: 4/4/2017
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    No, that would be a fraudulent conveyance.
    Answer Applies to: New Jersey
    Replied: 4/4/2017
    Mauritz Van Niekerk, Attorneys at Law
    Mauritz Van Niekerk, Attorneys at Law | Christiaan van Niekerk
    No, you can not do that they will not allow that.
    Answer Applies to: New York
    Replied: 4/4/2017
    Ronald K. Nims LLC | Ronald K. Nims
    This sounds like bankruptcy fraud. If you've got a $50,000 car and you sell it to your brother for $50,000 and file bankruptcy, the court will require you to turn over the money to pay your creditors, so why bother with transferring the car. But if you've got a $50,000 car and you sell it to your brother for $10 and file bankruptcy and don't disclose it to the court, that's fraud. People file bankruptcy because they have financial problems but people who cheat in bankruptcy soon have criminal problems. When you have criminal problems, you'll remember back to just having financial problems as the best days of your life.
    Answer Applies to: Ohio
    Replied: 4/4/2017
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