Quote Quoting BStone1
We met w/a bankruptcy attorney who has advised us that we can file Chapter 7 since hubby is the personal gauranteer on everything.
Whether or not he qualifies for Chapter 7 depends in no small part upon his income. If he qualifies for Chapter 7 under the current means test, I suspect that your lawyer is correct to recommend it.
Quote Quoting BStone1
In essence, all of our store inventory and non-exempt personal assets would be liquidated, creditors paid off and debt discharged. Is my understanding correct?
If he's the guarantor, it will be the business assets and his non-exempt personal assets that are subject to being liquidated. If you do not join the bankruptcy, your assets (including your share of the marital estate) should be safe.
[quote=BStone1]Basically, they're telling us to keep operating until we can sell. (We're maxing out our credit w/vendors so the bank wants us to finance more to pay vendors off so we can stay in business until the store sells).[quote=BStone1]
If there's a chance of selling, it's great to try to sell. If not, don't dig yourself into an even deeper hole. (It's called "throwing good money after bad.")
Quote Quoting BStone1
Bank wants us to....
Your bank is recommending a plan that will maximize how much it receives and, ideally, have you refinance with another lender so that your bankruptcy will no longer affect them. That's in their best interest, but it does not appear to be in yours. Also, right now the debt seems to be largely that of the business and your husband. The bank's plan would appear to shift that to you and your husband, and will probably eventually force you into the bankruptcy as well - something you may presently be able to avoid.
Quote Quoting BStone1
I just picture a the 'repo men' coming into my house, rummaging and taking whatever appears to have value.
Your husband will file an inventory of his assets with the court, and the trustee will consider whether to pursue certain items of property. Discuss this with the bankruptcy lawyer, as it's not as scary as you think, and you (if you're not a party to the bankruptcy) may even be able to purchase your husband's share of certain property if you have the (separate) resources to do so.
Quote Quoting BStone1
If we sell our house while in either Chapter 7 or Chapter 13 what would happen to the profit we made off the house? Do we pay it to the bankruptcy estate or is that protected? Thank you!
For Chapter 7, wait until after the final discharge or work closely with your bankruptcy lawyer. For Chapter 13, it depends upon how soon the house is sold after you start the repayment plan, and what you do with the money (e.g., buy another house, or bank it) - again, talk to your lawyer.
Quote Quoting gigirle
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The bank is gonna say, and do what is their best interest, not yours. If the security of the loan is only in your husbands name, then your husband is responsible for it legally. If your not tied to it financially (with loans, etc), then don't become attached to the debt by refinancing your joint house.
Agreed.
Quote Quoting BStone1
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Are the all of the assets that we have claimed protected? Or just to a certain dollar amt? I've checked out my state's exempt assets and am not sure about the camper, 4-wheeler, dogs. I'm having trouble interpreting.
You have an exemption up to the dollar amount(s) specified for your state. I don't think you followed the instruction to identify your state, so I can't say further.
Quote Quoting BStone1
We'd really like to have an attorney to deal with everything with them but can't afford someone else's services. Maybe check with the consulting bankruptcy attorney?
It's not like they're left "high and dry" in bankruptcy - they can make a claim against business assets and your husband's non-exempt assets. Will they get more if you hang on, sell the business, etc.? Probably. But I'm not sure what there is to negotiate, unless they start offering you the opportunity to settle your debts at a discount (e.g., 50 cents on the dollar).
Quote Quoting BStone1
So even though all of our business operations have been 50/50, because my husband is the personal gauranteer- he should file just individually? That'd save my credit?
Right. By his filing, you could largely insulate your credit from the effects of the bankruptcy.