What are normal fees for a bankruptcy trustee on sale of property? 6 Answers as of February 23, 2011

How is it determined if a fee buyer must pay to a trustee? Is negotiation on fees acceptable? Is a $10,000 fee reasonable on a $229,000 property?

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Law Offices of Dennis Baranowski
Law Offices of Dennis Baranowski | Dennis Baranowski
The trustee's fees are defined by Section 326 of Bankruptcy Code. The fees are paid for "all moneys disbursed or turned over in the case by the trustee to parties in interest, excluding the debtor, but including holders of secured claims." The fee structure is based on the following sliding scale: 1) 25% on the first $5,000 or less; 2) 10% on any amount in excess of $5,000 but not in excess of $50,000; 3) 5% on any amount in excess of $50,000 but not in excess of $1,000,000; and 4) reasonable compensation not to exceed 3% of such moneys in excess of $1,000,000.

A buyer should not be required to pay a "fee" to the trustee, unless you are negotiating with the trustee to pay a reduced amount to purchase the property from the bankruptcy estate. Unfortunately, without additional information, it is difficult to provide a more concise response. A consult with an experienced bankruptcy attorney will be able to yield a more definitive answer to your question.
Answer Applies to: California
Replied: 2/23/2011
William C. Gosnell, Attorney at Law
William C. Gosnell, Attorney at Law | William C. Gosnell
Sorry it varies from state to state and whether its urban or rural property.
Answer Applies to: Tennessee
Replied: 2/22/2011
Carballo Law Offices
Carballo Law Offices | Tony E. Carballo
The fees are set in the Bankruptcy Code. They are not negotiable since whatever is not paid to the Trustee will go to the creditors anyway. Therefore, why would the trustee accept less than what the laws allows him/her to earn in commission? The fee are whatever they are under the code and there is nothing you can do about it. The trustee will need court approval for the fees and so you are protected from having the trustee request too much in fees.
Answer Applies to: California
Replied: 2/22/2011
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
Trustee fees are found in the Bankruptcy Code at Section 326. It is a percentage based on what they disperse. I can't answer you question in dollars and cents because I don't know what the mortgage was. The bankruptcy Code is a available on line and you can look it up and do the math.
Answer Applies to: California
Replied: 2/22/2011
Diefer Law Group, P.C.
Diefer Law Group, P.C. | Abel Fernandez
It depends on what chapter you are filing. Chapter 13 fees are statutorily set by the court between $4000 - $4500. Chapter 7 fees are between $1200 - $2000.
Answer Applies to: California
Replied: 2/22/2011
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