What is a PREFERENTIAL TRANSFER TO AN INSIDER? Or, can I sell my condo to my sister for a dollar and declare bankruptcy?

Contact Us

If you sell any property to someone for less than close to what it is worth (Full Market Value), and then declare bankruptcy, the bankruptcy trustee may view it as a Preferential Transfer to an Insider / FRAUD. An nd, pull the property back into the bankruptcy estate.

Pretend you and your sister, brother or other relative bought a condo on a beach in Florida in 2014 for $100,000. You both put in $50,000 and both own 50%.  It is now 2018, and you are thinking about declaring bankruptcy and want to get rid of the condo first.  If the condo is now worth $200,000 your sister would need to pay you $100,000 for it to be considered a full market transfer.  If she only paid you one dollar the trustee would look at it as a fraudulent transfer with you trying to avoid paying your creditors.

Now let’s say the condo flooded, and $100,000 worth of work needs to be done. The condo’s current value is $10,000, but $100,000 in insurance proceeds are coming.  The insurance money could be brought into the bankruptcy estate.  So your partner in the property could still not buy the property for $1 without exposing you to a fraudulent transfer.

Now let’s say the condo is invested with roaches, has become a crack den, and is valued at $10,000.  Now an argument could be made that selling it to your co-owner for $1 was a good deal for you.

If you have any questions about fraudulent transfers to insiders or PREFERENTIAL TRANSFER  talk to a Bankruptcy Attorney today at 844-533-3367.

Schedule an Appointment or Contact Us With a Message

We look forward to hearing from you. Please feel free to get in touch via the form. We will get back to you shortly.  Call us at (844) 533-3367 or to contact us directly by email please use: Contact@PSCBLaw.com

Speak with our team to get experienced advice

We have over 30 years of legal experience. 

We understand that nothing is more important than the emotional, financial and spiritual health of your family, through its many transitions. We are here to help you. The mission of PCB Law offices is to provide our clients with the best legal advice possible.

Freehold, NJ - For Mail and Service

Jersey City, NJ

Hackensack, NJ

Brooklyn, NY

The Bronx, NY

Rochester, NY

Give Us A Call

(844) 533-3367

Send Us A Message

contact@PSCBLaw.com

Address For Service

1 Broad St #5
Freehold, NJ 07728

law firm logo

Office located in Jersey City, NJ; Freehold, NJ; Hackensack, NJ; Brooklyn, NY; Bronx, NY; Rochester, NY along with 5 affiliate offices in India.

Hours

We have agents manning phones 24 hours a day for emergencies. 

The Law Offices of Patel, Cardenas, & Bost provide probate, real estate, litigation, cannabis, entertainment, immigration, bankruptcy, foreclosure and loan modification representation to clients throughout the State of New Jersey and New York area with offices in Jersey City, Freehold, Hackensack, The Bronx, Brooklyn, and Rochester. This website is a Legal Advertisement. The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute an attorney client relationship. We are attorneys, but we are not your attorneys until a retainer has been signed.

ATTORNEY ADVERTISING. Past results do not guarantee future outcome. We are a debt relief agency. We help people file for relief under the Bankruptcy Code.

This site is designed to be accessible to and usable by people with and without disabilities. Please contact us if you encounter an accessibility or usability issue on this site.

This Website is for informational purposes only, is not intended as legal advice, and does not substitute for consulting with a lawyer about specific facts and circumstances. This Website does not constitute a solicitation, and your use of this Website does not create any attorney-client relationship between you and the Law Offices of Patel, Cardenas and Bost.

Copyright©2021 by Patel, Cardenas & Bost, LLC. All rights reserved.

Call Now