Questionnaire ATTORNEY version

Dear Attorney [Smith],

I am [Name and Company] and I work with BK Global on the sale of surrendered assets in bankruptcy. We are specialists in residential bankruptcy solutions that offer debtors and debtors attorneys better outcomes with relief and a true fresh-start.

We have found there to be some misconceptions about the disposition of real property in bankruptcy whether retained or surrendered. BK Global's Consented Sale Program enables you, as debtor's counsel, to earn additional legal fees when homes are sold in this program. Here are several key facts that need to be considered when real estate is involved.


Debtors file to retain their home in bankruptcy either to delay a foreclosure or stay in their home while they settle other debts. If a debtor’s plan is to keep their home these facts are very important to know.


  • MORTGAGE STATUS - If the debtor is current on their mortgage payments and they are able to continue making payments, then the option to retain is possible.
  • MODIFICATION - If the debtor is delinquent and is in need of a modification, they are required to apply with their lender within 30 days of filing a bankruptcy.
  • REQUIREMENT - Mortgage Servicers usually require debtors to have a mortgage debt to income below 40% in order to qualify for a modification, so they will need to have enough income to bring the loan current.
  • 90+ DELINQUENT - Over 95% of all debtors that are 90+ days delinquent and file to retain end up in foreclosure.


If a debtor’s plan is to surrender their home these facts are very important to know.


  • TRUSTEE SELLER – When surrendered the Trustee becomes the legal seller of the asset and can sell the home to settle the debts with the creditors.
  • TRUSTEE ABANDONS – In most cases, the Trustee will abandon the asset and file an NDR.
  • ABANDON BURDEN – When a Trustee abandons the asset the burden of selling the home falls back on the debtors.
  • FORECLOSURE LITIGATION – Most debtors believe that once surrendered they are off the hook, however not if the Trustee abandons the asset. The creditor requires a legal mechanism, per state law, in order to take legal possession of the property. Bankruptcy does not satisfy this requirement. While the debtor is not liable for any deficiency on the loan, they will be forced into foreclosure litigation. This creates emotional turmoil and long-lasting financial hardship.
  • SHORT SALE – A short sale can offer debtors a much better outcome by selling the home, settling their debt, potentially receiving a moving allowance, and preserving long-lasting financial hardship.
  • CREDIT SCORE IMPACT – A short sale will impact a debtor’s credit score by about 85–160 points (higher scores have greatest impact) but is only short-term giving the debtors the ability to re-establish their credit in 18-24 months. Debtors that are current with their mortgage payments can usually buy another house without having to wait, which varies from lender to lender.  FHA allows you to apply immediately for a new mortgage. Foreclosure, on the other hand, stays as a negative mark on a credit report for 7 years and even after that time passes a new mortgage will still be at a higher rate.
  • ATTORNEY FEE – In most cases mortgage servicers allow for fees to be paid for the sale as a separate fee from what is earned from the bankruptcy filing.


It is important to understand the facts of your client’s situation to determine the best outcome. Consider these topics for discussion.

  • Have you and your client discussed their real estate and the loan(s) associated with it? (Are they behind on their payments? (If the answer is “Yes” this can impact their decision to retain or sell the property.)
  • Do they know the current value of the property?
  • Do they owe more than the home is worth? (If “Yes” banks are very eager to work with them to sell the property versus going to foreclosure. Keep in mind, if your client has surrendered their asset the bank needs a legal mechanism to resolve the loan. The best method to do this is to have your client sell their property.  We can help through our Consented Sale program.)
  • Has the bank/lender initiated any foreclosure actions? (Even during the pandemic, things are still happening behind the scenes. We can check on this for you.)
  • Is your client aware that even after the debt is discharged in bankruptcy the bank can and will foreclose on the home if the loan is not current?
  • Has your client spoken with their lender about retention options? If they answered yes to the questions above, retaining the home can be more difficult and often leads to foreclosure. There are alternatives to foreclosure.
  • Did you know a foreclosure will impact your client’s credit for 7 years? (Selling in a short sale or Consented Sale will be a far better strategy and get you bankable sooner!)
  • Would you like to schedule a call with me and my team to address these items?

If you are unsure about the answers to any of these questions or if you have a case you would like us to review, we would be glad to research your case and offer our recommendations.

Let’s schedule a call to discuss.

All the best,

[Your Name]

If you are a real estate agent or broker and have not yet completed the Bankruptcy Specialist Certification Course, click here to get started.