[16-Jan-2020] DarksydePhil is filing for bankruptcy (general thread) - and has officially done so on January 31 2020, meaning a lot of his finances have become public

[Kosher Dill]

This won't be immediate, but it'll require him to pay someone to fight it.

Is there even any point in fighting it? I would think it's a pretty open-and-shut case: Phil owes X, the sale only brought in Y, Z remains as a claim against the bankruptcy estate. Probably all Phil's fighting is going to be to try to get the "Get Out Of Responsibility Free" card from Nancy.

 

[actually]

Is there even any point in fighting it? I would think it's a pretty open-and-shut case: Phil owes X, the sale only brought in Y, Z remains as a claim against the bankruptcy estate. Probably all Phil's fighting is going to be to try to get the "Get Out Of Responsibility Free" card from Nancy.

Yeah, the attempt to collect the deficiency is what he would be fighting.

 

[Wing Zero]

Yeah, the attempt to collect the deficiency is what he would be fighting.

Realistically though, how would he even fight that? I assume that would require a semi-decent lawyer to back him up and he sure as hell isn't going to spring for that, and there's no goddamn way MidFirst is gonna trust Phil with a payment plan. Isn't the obvious outcome there that he's forced to sell his WA condo?

 

[Sparkletor 2.0]

Didn't Phil say he only has $500 worth of clothes?

 

[c-beams]

Assuming the judge signs (and there's no reason not to), MidFirst can continue with their foreclosure proceedings in CT. Once that's completed, they can sell it and then try and get a deficiency judgement for the difference between the mortgage (~$110,000) and what they sell it for (assessed at like $60k). This won't be immediate, but it'll require him to pay someone to fight the deficiency judgement when/if MidFirst tries to collect via a lien on the WAKhando or some other method.

As a bonus, this order will remain in effect even if Phil's case gets converted to any other Chapter:

Bad time for Phil to get foreclosed on. Coronachan is going to delay the sale (racking up more fees). Midfirst is going to have a field day with the fat deficiency they're going to pimp smack Phil with. If the deficiency was only a couple thousand, I could see them not caring. But 50-60K? They'll be coming in hard for that.

 

[Il_Duke]

Big ups Midfirst Bank and the real hero of this saga

Big Ups - Streamable

Check out this video on Streamable using your phone, tablet or desktop.

streamable.com

 

[Pepper Jack]

Who would realistically pay $60k for Phil's shitty kahndo in the middle of coronachan? Whoever keeps estimating $50k in debt to Midfirst may be underestimating things. If Midfirst gets 50k for that kahndo I'll be surprised.

 

[actually]

Who would realistically pay $60k for Phil's shitty kahndo in the middle of coronachan? Whoever keeps estimating $50k in debt to Midfirst may be underestimating things. If Midfirst gets 50k for that kahndo I'll be surprised.

Better to estimate in the way that favors Phil. That way you either get what you expect, or you get a pleasant surprise!

 

[PutridElephant]

Who would realistically pay $60k for Phil's shitty kahndo in the middle of coronachan? Whoever keeps estimating $50k in debt to Midfirst may be underestimating things. If Midfirst gets 50k for that kahndo I'll be surprised.

Doesn't matter what the selling price is. Phil is on the hook for the remainder.

 

[architect]

I am going to sound like a broken record at this point, but there would have been no point in protesting the motion for relief from automatic stay today. Phil doesn't want the property and he doesn't care if it's sold even for $1. Deficiency judgements are treated like unsecured debts (because that's what they are). If Phil gets his debts discharged MidFirst won't be able to collect anything.

 

[rippersnapper]

I would love to see the listing photos when they come up, its gonna go low at auction I can feel it.

 

[actually]

I am going to sound like a broken record at this point, but there would have been no point in protesting the motion for relief from automatic stay today. Phil doesn't want the property and he doesn't care if it's sold even for $1. Deficiency judgements are treated like unsecured debts (because that's what they are). If Phil gets his debts discharged MidFirst won't be able to collect anything.

Aren't they likely to try and get a lien on the WAKhando, which would make it secured?

 

[King Daddy Telomerase]

Who would realistically pay $60k for Phil's shitty kahndo in the middle of coronachan? Whoever keeps estimating $50k in debt to Midfirst may be underestimating things. If Midfirst gets 50k for that kahndo I'll be surprised.

Agreed. 1 bedroom, 600 sq ft Deerfield Woods Condos were selling for $51-59k over the last 3 years. Assuming MidFirst Bank is just going to try selling this ASAP, even $50k may be high.

 

[architect]

Aren't they likely to try and get a lien on the WAKhando, which would make it secured?

If Phil didn't file for bankruptcy and Midfirst got a deficiency judgement after the auction of the property, they could have levied his bank accounts or put a lien on his WAkhando (depending on state laws). Bankruptcy protects him from all of that.

 

[actually]

If Phil didn't file for bankruptcy and Midfirst got a deficiency judgement after the auction of the property, they could have levied his bank accounts or put a lien on his WAkhando (depending on state laws). Bankruptcy protects him from all of that.

So what is the point of obtaining the deficiency judgment now? Will they petition the WA court to have their debt secured, or will they ask for the bankruptcy to be dismissed altogether? They must have a plan they think will succeed if they're spending the money to do all of this.

 

[Slimy Time]

Who would realistically pay $60k for Phil's shitty kahndo in the middle of coronachan? Whoever keeps estimating $50k in debt to Midfirst may be underestimating things. If Midfirst gets 50k for that kahndo I'll be surprised.

Property prices and rent prices are shitting the bed. I don't recall the state of the condo, but I doubt it will be sold at $60k now. I know rent wise, at least in my part of the world, are crapping themselves and begging tenants to stay because they know they won't be able to get one for months. I don't see it being sold at a time when people are going through economic hardships, and for such a run down, shitty condo that has been unoccupied for years and will probably need to be done up to be adequately liveable for the price paid.

Spoiler

Hell, I'm looking to move from where I am right now during Coronachan if possible. I can get a better deal for the same sort of apartment, all add ons and more, with slightly less space, for about 60% of what I'm paying rent now, maybe tie it up for a 1 to 2 year contract if I can.

 

[architect]

So what is the point of obtaining the deficiency judgment now? Will they petition the WA court to have their debt secured, or will they ask for the bankruptcy to be dismissed altogether? They must have a plan they think will succeed if they're spending the money to do all of this.

This is only a motion for relief from automatic stay. It's so they can auction off the property. At this point we don't even know if they will actually pursue a deficiency judgement when they do auction off the property. That's going to depend on the timeline of Phil's bankruptcy. If Phil's debts are discharged before they can auction the condo, they wouldn't even be able to get a deficiency judgement. If they manage to auction off the property and get a deficiency judgement before Phil's debts are discharged, they essentially become creditors holding an unsecured debt just like the credit card companies.

So we can only speculate why they're being this aggressive. I'm inclined to believe that they think Phil's case will be dismissed and they will want a deficiency (judgement) so they can proceed with collection efforts as soon as possible. But this is also a bank that's in the business of buying bad mortgages. The filing fee of a motion for relief from stay is only $180 if I'm not mistaken and they probably have lawyers on retainer who do nothing but file these motions all day. It's not costing them that much.

It's also possible that they think the property will be worth considerably less in a few months so they want to get rid of it as soon as possible.

 

[UncleTusky]

So what is the point of obtaining the deficiency judgment now? Will they petition the WA court to have their debt secured, or will they ask for the bankruptcy to be dismissed altogether? They must have a plan they think will succeed if they're spending the money to do all of this.

My reading reading of their proposed order for the bank to "to obtain complete possession of the Property free and clear of claims of the bankruptcy estate" is that they want it back with the ability to pursue him for the deficiency. That they're asking the order to be enforced even if it's converted to Ch13 makes me skeptical they're asking for/banking on an outright dismissal.

@AnOminous or someone can correct me here but I think they're arguing that since surrendering the CT khando in Ch7 would also absolve him of the $50k deficiency, that would amount to a claim by the bankruptcy estate and they want it nullified.

 

[DiabeticSP]

Usually if a bank is spending time and money to start the paperwork rolling its because they've decided how much they're likely to get is worth the cost/effort.

If the bank just wanted the house back they could wait out the bankruptcy because they'd get it back anyways since its value isnt over the mortgage.

So they're probably looking to get a lien/etc asap, because thats where the value is in bothering with the process.

 

[Comma]

A document titled 'ORDER TERMINATING THE AUTOMATIC STAY' was just filed (see .pdf attachment down below).

Spoiler: Text

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9                                     UNITED STATES BANKRUPTCY COURT
10                                     WESTERN DISTRICT OF WASHINGTON

11   In Re:                                                  Case No. 20-10323-TWD
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     Philip P Burnell,                                       Chapter 7
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              Debtor.                                        ORDER TERMINATING THE
14                                                           AUTOMATIC STAY
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         This matter came before the Court on the Motion for Relief from Automatic Stay filed by
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     MidFirst Bank (“Movant”). Based upon the record on file and the representations made to the
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18   court, IT IS HEREBY ORDERED:

19                     1.        This Order affects the real property located at 3699 Broadbridge Ave
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              Unit 107, Stratford, CT 06614 (the “Property”).
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                       2.        The automatic stay is terminated as to Movant. Movant may pursue all
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23            remedies under state law in connection with the Property and security interest, and may

24            commence or continue any action necessary to obtain complete possession of the
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              Property free and clear of claims of the bankruptcy estate.
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                       3.        Movant, at its option, may offer, provide and enter into any potential
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28            forbearance agreement, loan modification, refinance agreement or other loan

29            workout/loss mitigation agreement as allowed by state law. Movant may contact Debtor


     Order Granting Relief From Stay                     1                           McCarthy & Holthus, LLP
     MH# WA-20-160601                                                            108 1st Avenue South, Ste. 300
                                                                                            Seattle, WA 98104
                                                                                               (206) 596-4856
      Case 20-10323-TWD                 Doc 21   Filed 04/06/20    Ent. 04/06/20 14:02:02      Pg. 1 of 2
1            via telephone or written correspondence to offer such an agreement. Any such agreement
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              shall be non-recourse unless included in a reaffirmation agreement.
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                       4.        The relief granted herein shall be binding and of full force and effect in
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5            any conversion of this case to any other chapter. A conversion to another chapter does

6            not stay or enjoin the effect of this Order, or prevent Movant from foreclosing and selling
7            the Property, and recovering its costs, unless otherwise ordered by this Court.
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                                              / / / END OF ORDER / / /
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     Submitted by:
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     McCarthy & Holthus, LLP
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14   /sneed/ Lance E. Olsen
     Lance E. Olsen, Esq. WSBA #25130
15   Michael S. Scott, Esq. WSBA #28501
     Attorneys for Movant
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     Order Granting Relief From Stay                      2                            McCarthy & Holthus, LLP
     MH# WA-20-160601                                                              108 1st Avenue South, Ste. 300
                                                                                              Seattle, WA 98104
                                                                                                 (206) 596-4856
      Case 20-10323-TWD                Doc 21   Filed 04/06/20     Ent. 04/06/20 14:02:02        Pg. 2 of 2

-EDIT- 🕰 Super late, but I didn't see this had already been posted on the previous page. My bad. 🕰