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Operating a Business After Chapter 7

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  • 02-26-2009, 12:58 AM
    NWGolfer
    Operating a Business After Chapter 7
    My question involves bankruptcy in the state of: Washington

    I have consulting business in the state of Washington which is a sole proprietorship. I stopped doing business about 8 months ago because I wanted to explore another line of work. In total I have about 17,000 worth of credit card debt over 6 cards and I stopped making payments and using the cards about 6 months ago due to my poor financial state. In the fall of 2007 I purchased an 08' vehicle and a few months before I stopped working, I looked into trading it in. At that time I learned the trade in value on the car was 12000 and I owe 21000 on the loan, and the bank wouldn't approve a loan on a new car and add the balance of the old loan to it because it was too much and they needed a large down payment.

    I stopped making payments on the car about 6 months ago too because of my poor financial state, and about 2 months later the bank informed me they were going to repossess the car. A friend loaned me some money and I made a few payments over the last few months, but I haven't been able to make any more payments, so I'm expecting them to repossess the car. I'm staying with a friend and I've informed the bank and the credit card companies of my change of address so they've been frequently calling me and sending me mail.

    After they repossess the car, it'll probably sell at auction for 7-8k so the deficiency balance will most likely bring my debt grand total to right around 30000. I have no money or assets and I haven't operated my business or had any sort of income for 8 months. I understand I may be eligible to file for a Chapter 7 bankruptcy because of my poor financial state.

    My question was after if I file a Chapter 7 bankruptcy and all my debt is discharged, will I be allowed to operate a sole proprietorship 6 months to a year later?, and will my income be garnished at all? It's hard to say in these financial times but I expect a monthly income of 4-6k after expenses. I appreciate your answers and thank you in advance.
  • 02-26-2009, 08:45 PM
    OhMy
    Re: Operating a Business After Chapter 7
    After a chapter 7 discharge you are free.

    You can open a new business the next day if a family member decides to give you the opening costs.

    No one can sue you or try to enforce a judgment on any debt that was included in a chapter 7.
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