Legal Question in Bankruptcy in Massachusetts

Effect of Chapter 7 on Life Estate
My mother in law wants to file a Chapter 7 bankruptcy. Seven years ago she deeded her home to my wife, but retained a life estate for herself. She currently resides in the home. If she files Chapter 7, what happens to the house?

There is no mortgage, mother-in-law is 78, and has no assets.

Asked on 3/06/00, 4:02 pm

JAY Nixon nixon law offices

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Re: Effect of Chapter 7 on Life Estate

If the statute of limitations has not expired, this

transaction would generally be challenged as a

"fraudulant conveyance", via a suit against the

recipient of the gift. I'm not familiar with the fraudulant conveyance statutes

in MA, but in most states, seven years would put

you safely beyond the statutue of limitations. Under

the Uniform Fraudulant Conveyance act (at least the

WI version), you would would be safe four years after

the creditor knew of should have known of the transfer.

Answered on 3/20/00, 6:58 pm

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