sticky situation bank and foreclosure

[Guest ?pensionguy]

Okay hate to have to try and write all this but here goes client purchased house in plan owned 2 lots in addition nearby outide plan asked bank for loan bank said okay did papers using lots (and house in plan as security) economy went south so did clients business default on loan. 401 k plan is husband and wife only no common law employees bank told judge property was collateral for loan (client claims never was aware) I said creditors claim etc. bank said not covered by ERISA so is subject to creditors claim. I need an attorney that can give guidance (if any is available) to save house if it can be saved since it was/is owned by plan and should never have been used as collateral. Anyone have any suggestions to help out on this? Or suggestions of appraoch to take

[ETA Consulting LLC]

Who has 1st lien on the property; the bank or the plan?

[QDROphile]

If the plan does not enjoy ERISA protection, state law might limit creditor rights. If you are looking for a referral, it would help to know the location (state, at least). This is not the best forum for referrals.

[mbozek]

In some bank loans the property pledged for the loan is defined broadly and includes any property over which the debtor has legal control including assets of a pension plan over which he is a fiduciary. Need to consult counsel to determine if such a pledge is valid as there may be defenses such as exclusive benefit rule. Also please follow conventions for grammar use, e.g. periods, which will make it easier to understand what you are saying.

[Guest ?pensionguy]

the state in question is Kentucky. We have contacted DOL and they turned down action because of exemption in ERISA of husband wife plan (no common law employee), guy is at his wits end to stop this so a good erisa attorney would be appreciated as I am sure this has come up before.