Will I lose my car if my sister files bankruptcy? 11 Answers as of July 12, 2013

Will I lose my car if my sister files for bankruptcy and the car used to be under her name but now it’s under my name. Will her bankruptcy attorney be able to take my car away?

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Benson Law Firm
Benson Law Firm | David Benson
That depends on the circumstances of your case. But this is a transaction between "insiders" and thus invites greater scrutiny from the bankruptcy trustee. If the transaction took place more than a year ago, you're probably OK. If it took place more recently, then it will be a question of whether fair value was given for the car and, if not, whether any unpaid value is covered by available exemptions.
Answer Applies to: Ohio
Replied: 4/22/2011
Bankruptcy Law office of Bill Rubendall
Bankruptcy Law office of Bill Rubendall | William M. Rubendall
The answer depends on two things. If the transfer if less than one year prior to bankruptcy the trustee wins. If the transfer occurred more than one year prior and was based on fraud the trustee also wins.
Answer Applies to: California
Replied: 4/22/2011
Indianapolis Bankruptcy Law Office of Eric C. Lewis
Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
Bankruptcy attorneys don't take anyone's car! If the title was transferred within a short time before the bankruptcy is filed, the bankruptcy Trustee may reverse the transaction and seize the asset on behalf of the creditors of the bankruptcy estate.
Answer Applies to: Indiana
Replied: 4/21/2011
Rhonda R. Werner Schultz, PL
Rhonda R. Werner Schultz, PL | Rhonda R. Werner Schultz
If the car was transferred in the last year from your sister to you, it is at risk of being taken by the Bankruptcy Trustee (not the attorney) in a Chapter 7 bankruptcy. There are several issues that need to be considered here, first was the transfer arms length, meaning you paid a fair price for the vehicle from your sister. If you did not, did you make the payments on the car before the transfer and it was just titled in your sister's name for some other reason. You will need to talk to a skilled bankruptcy attorney to find out whether the vehicle is at risk of being surrendered to the bankruptcy court. Transfers between family members are considered "insider" transfers and are looked at more closely than other transfers.

If the transfer was made for the sole reason that your sister did not want to have the asset at time of filing bankruptcy, you are likely at risk of losing the car. The attorney should look at the value of the vehicle and what exemptions your sister is eligible for. If there are sufficient exemptions, it may not be an issue. Again, I suggest you talk to a knowledgeable bankruptcy attorney to address your concerns.
Answer Applies to: Wisconsin
Replied: 4/21/2011
Ferguson & Ferguson
Ferguson & Ferguson | Randy W. Ferguson
It will be the bankruptcy trustee not her attorney. If you did not pay full value and it was transferred to you, the trustee will look at it if it is paid for.
Answer Applies to: Alabama
Replied: 4/20/2011
    William C. Gosnell, Attorney at Law
    William C. Gosnell, Attorney at Law | William C. Gosnell
    If she is still liable on the note, then unless she reaffirms the debt. The car is gone.
    Answer Applies to: Tennessee
    Replied: 4/20/2011
    Greifendorff Law Offices, PC
    Greifendorff Law Offices, PC | Christine Wilton
    Who owes the money? When was the car transferred to your name? More information is needed.
    Answer Applies to: California
    Replied: 7/12/2013
    Carballo Law Offices
    Carballo Law Offices | Tony E. Carballo
    Probably not but if you sister transferred the vehicle to you so that her creditors would not take it from her then she may have done a transfer which can be set aside by the bankruptcy trustee. It depends if you paid the fair market value for the car. Your sister cannot not simply give away property if she owes money to avoid having the creditors take it. She was supposed to report transfers of property within two years of filing for bankruptcy so it depends on whether she told the truth and reported the transfer or did not report it to prevent the trustee from finding out.

    It is not her bankruptcy attorney who will take anything but rather the trustee who is appointed by the court to investigate the bankruptcy case and recover any property of your sister, including property that was transferred illegally to avoid paying the creditors or that was transferred and not property reported in the bankruptcy petition. If your sister transferred property and did not report the transfer she might be denied a bankruptcy discharge and may even face criminal charges for perjury and/or bankruptcy fraud. Therefore, no one can answer your question without having a lot more information about what you sister did or didn't do and what your involvement was in the transfer.

    For example, if you did not pay your sister the value of the car and you knew that your sister was transferring so as not to lose it in the bankruptcy case or to avoid paying creditors, then you could be facing problems also including the loss of the vehicle.
    Answer Applies to: California
    Replied: 4/20/2011
    The Law Office of Mark J. Markus
    The Law Office of Mark J. Markus | Mark Markus
    Bankruptcy attorneys don't take things away. That is not their function. Whether or not the Trustee in her bankruptcy will come after you depends on a number of factors, none of which you've provided information on. If she filed a Chapter 7 case, and she transferred the title of the vehicle to you within 2 years prior to filing her case, and she did not receive fair market value from you for the transfer, then the Trustee can sue you to recover the value of the vehicle.
    Answer Applies to: California
    Replied: 4/20/2011
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    Probably you will get to keep it. Unfortunately there is not enough information here for me to fully answer the question, like how much is the car worth? Is the there a loan against it? When was the transfer? Was she insolvent when she gave it to you?
    Answer Applies to: California
    Replied: 7/12/2013
    Bankruptcy Law Office of Robert Weed
    Bankruptcy Law Office of Robert Weed | Robert Weed
    Not if you paid her for it if she gave it to you, maybe. They would be allowed to go after it, if it's worth the trouble.
    Answer Applies to: Virginia
    Replied: 4/20/2011
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