Does a homeowner filing for bankruptcy within the 45-day extension of their home’s foreclosure sale due to a non-occupying successful bidder still own an interest in the home?

In re Tinsley U.S. Bankruptcy Appellate Panel of the Ninth Circuit

Facts: A trustee’s foreclosure sale is held on a one-to-four residential property. The successful bidder is a non-occupying bidder, automatically extending the bidding period. The homeowner whose interest is being foreclosed files a petition for bankruptcy before the extended bidding period runs. The foreclosure sale is completed at the end of the 45-day extension, and a trustee’s deed is recorded.

Claim: The mortgage holder claims the homeowner was no longer the owner of the property at the time they filed the petition for bankruptcy since the foreclosure sale had a successful bidder.

Counterclaim: The homeowner claims they owned the property when the petition for bankruptcy was filed since the successful bidder at the foreclosure sale auction was a non-occupying buyer, automatically extending the bidding period and delaying completion of the trustee’s sale.

Holding: The Ninth Circuit bankruptcy appellate panel holds the homeowner still owned the property when the petition for bankruptcy was filed during the mortgage holder’s foreclosure process since the foreclosure sale was not final at the time of the filing due to the extension permitting further bidding. [In re Tinsley (9th Cir. BAP 2026) __ BR __]

In re Tinsley U.S. Bankruptcy Appellate Panel of the Ninth Circuit

May an individual in bankruptcy claim an automatic homestead exemption on real estate they occupy as their personal residence when title is vested in an LLC which is co-owned by the individual and their spouse?

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