Legal Question in Real Estate Law in Arizona

BK and foreclosure

My mother-in-law owns the house we live in but I am on title with her. My husband filed BK in May 07 and because of community property in AZ, the house went into the BK. The house also went into foreclosure in April with trustee sale scheduled for June. Since the BK was filed in May prior to the sale, there should have been an automatic stay. However, in looking in county records, there was a sale that took place in June 07 to another bank. Our lender still has the mortgage account open in our name and is scheduling another sale date. They say that they didn't realize that the house was in BK when they had the sale. We are trying to sell the house but are confused about the true ownership of the home now. Do we have legal recourse against either bank (our lender or the bank that bought it)or the title company who insured the property? If we get an offer to sell the home, do we still have the right to sell it?


Asked on 10/01/07, 2:24 am

1 Answer from Attorneys
James Jenkins Jenkins Law Center PLC

Re: BK and foreclosure

The facts you present are well stated, but a couple of things are left out. Was your name on the bankruptcy? Was your husband's name on the house?

A bankruptcy does in fact place a stay, but in order for the trustee to know about the stay, they have to get notice or a copy of the bankruptcy filing. If there is a pending bankruptcy, they must file a motion in the bankruptcy court to lift the stay.

You need help from a bankruptcy attorney. We can recommend one if you call 480.835.1500. No opinion can be given on your case without a complete review of the facts and documents.

Best regards,

James D. Jenkins

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Answered on 10/01/07, 11:34 am


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