Legal Question in Bankruptcy in California

To sell your house, you'd have to obtain permission from the bankruptcy court through a motion to allow sale of residence. If there are proceeds, you may be entitled to keep it as part of the exemptions you claimed in the Chapter 7 case. For example, if you already chose the federal exemptions, then it may be as high as $21,825. If you chose the California exemptions, then under the homestead exemption, a husband and wife can exempt up to $75,000. But, as you said, leftover proceeds are highly unlikely if you're upside down right now. After discharge, you can try a short-sale at any time.

Larry L. Doan, Esq.

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