Don Reser, Realtor/Attorney
Danny and Matt have basically laid it out for you. If I was your Realtor I would be pushing like crazy to get this house closed FAST! I'm also sure the listing agent would be singing the same tune. The attorney that you should get will be there to guide you in
case things do go south and you don't get the house. Once you close though, those old debts and even possible filed liens on the property should be already addressed and washed off once you close and become the new owner. That is the title companies job to ensure that happens, but I have heard some horror stories out there.. and that's why there is title insurance.
Best of success.
Your best bet is to contact a real estate attorney and speak with your agent (if you have one). This becomes a legal matter and depending on what state you're buying in the laws (and your rights in the contract) may be different (you're listed as New York, but you've posted in San Antonio, TX). I would not complicate matters further by getting advice from anyone other than a qualified real estate attorney.
Good luck to you!
I do not know the Homestead laws of New York, but the federal bankruptcy laws are all the same. We are not to give legal advise but let us assume you have no homestead laws to protect the seller and just the federal bankruptcy laws. You will purchase the home and the profits will go to the court to distribute to list of debtors.
This does not make any difference to you, just to the seller. Anything not protected by some homestead or other law must be sold and the proceeds distributed.
You may have made a better deal because of this situation. But do conult an atty.
Very scary indeed! Since you are buying in NY, I assume that you already have a real estate attorney, and are either in 3 day review or just past it. Talk to your attorney, straight-away. If you don't have one, then get one and bring your contract.
Please keep us updated - we'd like to know how this pans out, and what the lawyer says.
So, I would be optimistic... Do you have a realtor? If so, they should be able to sirect you to the proper representation.
Never a dull moment!