Hi Jon,

You cant buy a home in bankruptcy. If the seller was in default, but filed bankruptcy then there is a "stay" on the foreclosure. Did you mean buy a home in pre foreclosure or foreclosure?

It is hard to tell you how to approach a case in bankruptcy. First it depends what type of bankruptcy was filed by the owner. If it is a chapter 7 the bankrupcty most likely will not last more than 4-6 months. It will depend on if there are more assets than liabilities. A chapter 7 is usually used to discharge the debt and usually focus on credit card debt and stalling foreclosure to insure that the lender does not persue deficiency rights. When the debt is discharged, the banks will get a relief from the stay of the bankuptcy and continue the foreclosure process and acquire the property via foreclosure.

A chapter 13 or 11 bankrutcy are used to reorganize the person or companies debt, so they can try to keep there assets and work out payment arrangements. Sometime either the person filing bankrutcy or the the bankrutpcy trustee ask the property be put on the market.

The best thing is to get a buyers agent to see if they can find out if the property can be sold or if the owner is going to let it go to foreclosure after the bankruptcy is discharged or if they are trying to stay in the home with the debt reorganization. Lots of time people file bankruptcy figuring it will resolve there problems and it really only delays the problems.

Best move in it can be months, years prior till property resolves these issues with the courts. Confer with buyers agent for these details.

National Featured Realtor and Consultant, Mortgage Loan Officer, Credit Repair Lecturer
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Lynn911

Jon,

Be sure not to miss out on the home of your choice. Our recommendation is to be in touch with a local real estate professional and request that they monitor the market for new listings that include your target home.

The home may not be available for sale if it was included in the bankruptcy. Once the bk is discharged, tghe lender will most likely foreclose and it will be available again for sale.