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When people decide to file bankruptcy, they may choose to keep their home. Under Chapter 13 bankruptcy, the homeowner usually has the option to do so, providing that he or she sticks with a repayment plan that has been approved by the court and is administered by the trustee. Some Florida homeowners may decide that they wish to sell the home before the bankruptcy has been paid off. In these cases, there are a few steps that must be taken.

One of the first things that needs to be done in this situation is informing anyone who may be involved. As soon as the decision to sell the home has been made, it is vital for the homeowner to let his or her bankruptcy attorney know. There will be a lot of paperwork needed to start the process, so the lawyer will need time to inform the trustee and get things in motion. The potential homebuyer and any real estate agent involved will also need to know that the home is under a Chapter 13 proceeding.

The homeowner will also need to file a motion to sell, which the trustee has to approve. This paperwork should state the sale price of the property, the value of the property and an appraisal to prove the value. A proposal for distribution of the earnings from the sale should also be included. In most cases, this money would go toward paying off the house payments and any closing costs from the sale.

Once the trustee has approved the sale of the home in a Florida Chapter 13 bankruptcy, there will be a few more steps to take. A bankruptcy attorney can guide the homeowner in how to proceed in order to complete the sale and potentially pay off his or her bankruptcy debt. At that time, a judge would sign the final decree stating that the homeowner is out of Chapter 13.

Source: homeguides.sfgate.com, “Can I Sell My House in a Chapter 13 Bankruptcy?“, Accessed on July 4, 2017