Re: Almost All Secured Debt
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bankrupt
My question involves bankruptcy in the state of: MI
very little unsecured debt, and that's only charges from several months ago for some surprise expenses. My wife and I were generally adverse to unsecure debt.
house (primary and 2nd mortgage), easy 75-90k upside down
boat, 10k upside down
my car 10k upside down
visa card (same bank as car note, but not our primary account) 4k
all the above are in my name alone, both ownership and debt
wifes car, 5k upside down, her name, with me as co-signer
her visa - essentially zero balance
I suddenly lost my good paying job in this wonderful economy. I have no expectation of anytime soon returning to work, and when I do, expect to see a substantially lower salary. Without making house/my car/boat payments, we'll survive a year before things get really ugly.
My attorney (not BK) made several recommendations.
immediately stop making payments on all of my fixed assets and visa
He would recommend a BK attorney in about 12 months, said I'm far from needing to file.
Hinted that some of clients have made credit purchases 120 days ahead of BK filing, and had the debt discharged.
If there was any way to keep my car, it would be my preference, but he said it would be illogical to lose 10k on an inanimate object.
What is the status of our joint investment account? Should I use that to pay our bills, or will that go to satisfy my debts?
Is Chapter 7 the logical answer?
I know I'm way ahead of the game, but want to help plan through this so we can get on with rebuilding our life.
Actually chapter 7 seems like a great choice and do it NOW not in a year. This site can put you intouch with a bk lawyer in your area.
Re: Almost All Secured Debt
Did your attorney give you a reason as to why wait a year? Is it bc you have money in the bank to pay your current bills?
Re: Almost All Secured Debt
He didn't come right out and say it, but think he was waiting until I burned through the cash and have some collections. The biggest question is how long will I be out of work, and in today's economy, I'm estimating 12-18 months and at a considerably lower income level then I was at a week ago. Problem is, I'm totally current on all my bills.
Re: Almost All Secured Debt
Your obsticle here is that you qualify for Ch 7 now with no income. If a job presents itself, depending on your income, you may no longer qualify for Ch 7. Bankruptcy isn't exactly a quick process.
And without coming right out and saying it, thats exactly what he meant. Keep great records of where your money is going from now until you file if you do. You will have to list all your collections in your bankruptcy and risk surrendering them.
Re: Almost All Secured Debt
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Quoting
gigirle
You will have to list all your collections in your bankruptcy and risk surrendering them.
What does that mean?
Keep in mind I will be collecting unemployment for 6-9 months and providing some income. Does it make sense to wait until I'm not going to have any income vs the unemployment income? My wife remembered something from our visit with our personal attorney, he said we had to have a judgment against us to actually file.
I do not have a great desire to keep the house or boat, although not thrilled with moving, especially since our youngest is a sophomore in HS.
Re: Almost All Secured Debt
I am not a lawyer but you do not have to wait till you have a judgement, you will have to wait until your income matches the gross income that will allow you to file in your state cpt 7. So that could take as long as 6 months depending on you r past income. I would not wait to long secure a BK lawyer so you know what path you will be on. If you are not confortable with him or her find one that you trust with your situtation. I am in the same boat filed 13 and now a 7 go this thursday for the 341 meeting. The blessing is all debt will be forgiven bk is your only way out of peace of mind. Don't feel bad i beleive we aare going to have so many BK in this country it will make your head spin. The bible tells us just all that is happening in the world today.
God Bless You and All Who Will Follow!
Re: Almost All Secured Debt
Quote:
Quoting
bankrupt
What does that mean?
Keep in mind I will be collecting unemployment for 6-9 months and providing some income. Does it make sense to wait until I'm not going to have any income vs the unemployment income? My wife remembered something from our visit with our personal attorney, he said we had to have a judgment against us to actually file.
I do not have a great desire to keep the house or boat, although not thrilled with moving, especially since our youngest is a sophomore in HS.
A ch 7 is a total liquidation of your assets. Do some research on the net and this site as well. When and if you file, you will have to list collections that you own. Lets say one of the collections you own are cars. The court can order you to sell them to pay creditors.
Even if you will be collecting unemployment, you should be able to qualify. Take the means test to see if you qualify. I'll also go out on a limb here and say that your wife misunderstood your personal attorney. You DO NOT have to have a judgement to file, but if you have a suit in the works, then you should file.
Re: Almost All Secured Debt
Quote:
Quoting
gigirle
A ch 7 is a total liquidation of your assets. Do some research on the net and this site as well. When and if you file, you will have to list collections that you own. Lets say one of the collections you own are cars. The court can order you to sell them to pay creditors.
Even if you will be collecting unemployment, you should be able to qualify. Take the means test to see if you qualify. I'll also go out on a limb here and say that your wife misunderstood your personal attorney. You DO NOT have to have a judgement to file, but if you have a suit in the works, then you should file.
thank you gigirle
I will call my attorney and clarify both the judgement comment and why he wants to wait. I don't have a collection of anything, just one car that's upside down and I would like to find some way to keep... but understand it may be going away.
The irony here, we very seldom used charge cards for anything and would frequently pay them off, and saved enough money for emergencies, but never anticipated this financial perfect storm that hit. My house three years ago was rediculously high value, and has sunk to the point of being rediculously underwater. Boat up until last fall was tracking my loan value down literally dollar for dollar, and now that has tanked. My car was doing ok, until the OEM flooded the market with money trying to avoid their own bankruptcy. I could deal with all of that until the job went away :(
Up until 1/31 I was current on everything, so still a little bit early. Scary watching my high 700/800 credit go away. But I whine...
Re: Almost All Secured Debt
talked to my attorney, he said we're waiting for several reasons, one I'm sitting on too much cash (benefit of a somewhat frugal life), two there is still a chance I'll get back to work and may impact what gets files, and three he's waiting to see if there are going to be some legislative changes that would benefit any potential filing. He also suggested that the housing market isn't even close to bottoming out and if the lender even considered resetting the house value, nobody could tell him the current market value. I especially agree with that statement