My Situation layed out: Should I file???

[Chris_FL]

Ok, Here it goes. I'm 24 years old, I own my own business my wife and I run.

The economy has hit us very hard as of late and we're finding it a struggle to pay our bills to say the least.

I have perfect credit, nothing's ever been late but everything as this point is right on the verge of just snowballing behind.

I have many lines of credit including a Mortgage (1st and 2nd) 2 vehicle payments, boat, 4 credit cards (about $14k in unsecured CC debt) Other lines with no balances on them or very minimal that I would not like to necessarily include in any BK

My house is At minimum 100K up side down with this market, I recently purchased the house in June 07 for $405K, My mortage with taxes is an astronamical $4,000/mo

My business made $200k in 07 and stands to make about 50-55% of that amount in 08. This is my major problem as my bills that were accumulated were really based on being able to bring the income we were use to in.

My wife has decent credit but nothing at all is in her name because mine's always been better, everything is solely in mine as I get the checks from the business account. One of my main concerns is, for one, can you file BK even if you make $100-120k on your return? Can you file BK personally yourself so that your spouse's credit doesn't suffer? Is it possible to file BK personally without filing BK for your business?

In all, walking away from my house, 2 vehicles and boat would fix my situation. I am willing to pay my unsecured debts and ofcourse understand all my secured debted properties would be reposessed, do i need to file BK?
In all reality, the thought of a clean slate lifts so much weight off my shoulders, I feel like we really go ahead of ourselves by getting in such a situation with debt that we would need to make so much money just to pay the bills.

I'm seeking advice and information currently and do plan on speaking with an attorney but would like to get some oppinions from people that may have been in a similar situation or have knowledge.

[Mark80]

[PoorGrammyinBK7]

It sounds like you want to keep your business, which probably means you are looking at a Chapter 13, depending on what kind of business it is and whether the business has assets.

[Stilltheone]

[QUOTE=Chris_FL;213631]I have perfect credit, nothing's ever been late but everything as this point is right on the verge of just snowballing behind.[QUOTE]

When we filed bankruptcy, we had perfect credit also. We had never been late on a bill in our life. BUT, we were just like you...on the verge of snowballing. A paycut will do that to ya.

The thought of a clean slate feels like a huge relief because, after all is said and done, it IS a huge relief.

BUT, I agree with PP's. Having a business makes it very tricky. I would definitely consult an attorney and get legal advice.

Good luck to you!

[Chris_FL]

Called my Mortgage company, nothing they can do to help at all, called one of my car lenders, cannot help me.

My wife is worried that they will come after my business. My business currently has no equity (more debt than inventory/equipment)

Does anyone know how it works when you're self employeed? I mean, they cannot take your means of employment can they?

[StartingOver08]

This is a very difficult point when you have a business. I have an S corp and because I am the sole owner of the S corp, 100% of the receivables AS OF THE FILING DATE belong to the Trustee. I had no equipment of value other than computers, printers, scanners etc. I filed personally, but have to close the S corp because the creditors can get a judgment against the S corp and sieze the bank accounts of the S corp. I filed personally so the debt is discharged against me personally - but not the corp.

So is your business a sole prop, S corp or what?
Does your business have equipment and other assets?
Do you have debt in the business name that is personally guaranteed by you?

These are the kinds of questions you need to answer and provide an attorney so he can evaluate your situation.

PS
I have a friend of mine that was counting on filing BK. They also are business owners - but because the business is in tree trimming they have lots of equipment, most of it Free and Clear of any liens. According to one BK attorney they have talked to so far, it looks like BK is not an option at this point because the Trustee will want all of the equipment. When you own your own business, your business is actually one of your assets. So in their case the Trustee would take the equipment and sell it to obtain proceeds to pay off creditors. It can get very confusing

[Chris_FL]

This is a very difficult point when you have a business. I have an S corp and because I am the sole owner of the S corp, 100% of the receivables AS OF THE FILING DATE belong to the Trustee. I had no equipment of value other than computers, printers, scanners etc. I filed personally, but have to close the S corp because the creditors can get a judgment against the S corp and sieze the bank accounts of the S corp. I filed personally so the debt is discharged against me personally - but not the corp.

So is your business a sole prop, S corp or what?
Does your business have equipment and other assets?
Do you have debt in the business name that is personally guaranteed by you?

These are the kinds of questions you need to answer and provide an attorney so he can evaluate your situation.

PS
I have a friend of mine that was counting on filing BK. They also are business owners - but because the business is in tree trimming they have lots of equipment, most of it Free and Clear of any liens. According to one BK attorney they have talked to so far, it looks like BK is not an option at this point because the Trustee will want all of the equipment. When you own your own business, your business is actually one of your assets. So in their case the Trustee would take the equipment and sell it to obtain proceeds to pay off creditors. It can get very confusing

As far as my business, I have zero equity in it, I carry about 50k in inventory, 10K max in equipment and have a maxed 50k line, 15k credit card, 10k and 4k credit cards. All of my business debt has myself as the guarantor.

If you add my assets within my business and my debts i have negative equity. My business continues to make profit, just not enough to pay my bills. I spoke with my mortgage company about lowering my payment since they're collecting $400/mo more than they need to on my escrow. Also considering letting go of 1 car, and a boat which will save me around 2k/mo when factoring ins, storage and etc.