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  1. #1
    Join Date
    Jul 2012
    Posts
    1

    Default How to Proceed: File Chapter 7 or 11 or Settlement Arrangements

    My question involves bankruptcy in the state of: FLORIDA

    My question involves bankruptcy in the state of: FLORIDA

    I'm not really sure where to begin with this, but here's my situation:

    (1999 - 2005) My brother and I operated a small business, I was a silent partner. My brother passed. During my time from the office grieving the loss of my brother (3 weeks) my brother’s wife, without my knowledge forged several checks draining our bank account, cashed several accounts receivable checks, sold all of our business assets all within 3 weeks after my brother died. I had no idea any of this one going on until I received a call from the person who bought some equipment wanting to know if I had the maintenance log books. All total, she ended up with approximately $235,000.00 cash leaving me penniless and jobless.

    Four months afterwards, I hired an attorney which he soon discovers she has sold their marital home, paid off all her bills, and purchased a new home and car, paid cash and put it in her son’s name. Basically, he told me he could have her arrested for grand theft, but the end result would be a lot of attorney fees only to end up with a useless judgment as she had no assets.

    I'm now out of work, living on a small income from rental property I have.

    (2006) My mother was diagnosed with Alzheimer disease and I moved her into my home so I could take care of her. From 2006 through 2011, I was barely able to make ends meet.

    (Jan, 2012) My mother passed away and I have been in somewhat of a depressed state.

    Credit card companies and debt collectors have been calling relentlessly.

    (July 2012) I received a summons from what I think is the original credit card company’s attorneys or maybe a third party collection agency. I just checked my credit report and the account shows it was charged off. So I don't know for sure who is suing me, or if it really matters at this point.

    Now, my question is what do I do at this point? Should I file an answer to the summons? ……Or file for bankruptcy? …… Or do both?

    I own a home with a mortgage; I have income producing property that provides my sole income, and your basic household items.

    I'm not sure exactly what too do, I plan to speak with a bankruptcy attorney Friday, but I have no idea if I even qualify for either of these options, 7 or 11. Preferably, even though I don’t agree with the amount in question, I would like to settle with the creditors and be done with it; the approximate total debt is over $30,000. but less than $100,000., which as I said, I don’t agree to the amounts.

    With the above mentioned rental income and finagling each month, I have been able to make the mortgage payments. I was just preparing to request my mortgage company to consider me for a loan re-modification but now I'm not sure exactly what the outcome would be if I filed for bankruptcy.

    I know, pretty lengthy message, this is actually the shortened version, hope it makes enough sense to possibly provide a little guidance to help get my life back in order. Believe it or not, prior to all this I had never been late on anything, I had a perfect credit score, now it gone down the tubes.

    Thanks for taking the time to listen to my story; I would deeply appreciate any advice given.

    FourToOne

  2. #2
    Join Date
    Sep 2010
    Posts
    478

    Default Re: How to Proceed: File Chapter 7 or 11 or Settlement Arrangements

    I am sorry for your loss, brother, parent and business. Things will get better.

    Since you have income producing property that you wish to protect, if you cannot find an exemption to cover it, you will most likely be staying far away from a Chapter 7. In a Chapter 7 you will lose any non-exempt asset that has value and your ability to collect the rents will end the moment you file as post petition rents are property of the bk estate and would belong to the Chapter 7 Trustee, unless he abandons the asset.

    I am not sure why you mention a Chapter 11. You would only use that Chapter if your debts exceeded the debt limits of a Chapter 13 or you were attempting a cram down on rental and could not afford to pay the cram down value over 5 years (cram down = forcing a modification of the balance owed on the loan down to the value of the real estate). Are you wanting to do the cram down????? If so, then the 11 would be the way to go if you need more than 5 years to pay the secured amount. If a cram down is not an issue and you are below the debt limits, you would be looking at a Chapter 13.

    I wish I could comment more but I can’t as there are way too many options. It is good that you are going to discuss your issues with an attny. Since consultations are usually free, make sure you see several.

    Des.

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