Severe business and personal bk issue HELP!

[catwhisperer]

Hi,
I've written here before and now have a more serious problem. We are going to file Chapter 7, just trying to get the attorney appointment which should happen this week.
We have a Business Loan and STUPIDLY I think I signed away my soul.
Well the business loan is now trying to call the loan and we personally guaranteed it. Also signed a Disclosure for Confession of Judgement.

Here's the question - if we file Chapter 7, other than objections at the hearing, is there a way for someone to still come in and take everything, even if the business personal guarantee is listed on the bankruptcy? Is a discharge a total discharge or can they say "forget it, you still have to pay this bank" .My concern is that even after filing personal Chapter 7 that this bank is going to keep coming after us even to the GRAVE!

Signed - losing sleep.

[FilingOnMyOwn]

Are you saying its a business loan as in loaned in the name of your business? Or a personal loan you took in your name to open a business? If its a loan in the name of the business, that might fall into a chapter 11 type filing. If its a personal loan in your name, and you file chapter 7, they may take your assets to repay your debt. Once its over, they can't come after you for life, no.

[catwhisperer]

It is a business loan taken for our subchapter S corporation. We personally guaranteed it. From what I understand, filing chapter 7 for us personally would include personal guarantees.

If we have a $10,000 exemption for personal stuff and the rest would be auctioned - for example - and we only have $7000 worth of assets, can they still take the $7,000 assets and wipe us out clean. What is the point of bankruptcy if they can still wipe you out clean. Does the exemption mean nothing against this bank loan - that's what they are threatening us with.

[no_it_all]

The Confessions of Judgement you signed can be very scary...You pretty much signed off all your rights.......did the lender require you to personally guarantee the loan AND sign the C of J??

[FilingOnMyOwn]

It is a business loan taken for our subchapter S corporation. We personally guaranteed it. From what I understand, filing chapter 7 for us personally would include personal guarantees.

If we have a $10,000 exemption for personal stuff and the rest would be auctioned - for example - and we only have $7000 worth of assets, can they still take the $7,000 assets and wipe us out clean. What is the point of bankruptcy if they can still wipe you out clean. Does the exemption mean nothing against this bank loan - that's what they are threatening us with.

No, they can't wipe you clean, as long as you correctly exempt everything in your filing. And as long the exempted items listed are within the allowable amount for your state, they won't take it. Sure, they will threaten you will all kind of lies, thats what collection people do.

[catwhisperer]

Yes we signed our life away. Looking back, it was a DUMB thing to do.

My major question is this - if you get an exemption, can they even take what is exempted. If they don't get what they want, can they attach our wages even after a chapter 7 is discharged. We don't want them haunting us for the rest of our lives.

[catwhisperer]

The Confessions of Judgement you signed can be very scary...You pretty much signed off all your rights.......did the lender require you to personally guarantee the loan AND sign the C of J??

You bet I did. Yes we personally guaranteed the loan and signed the C of J. It states that they can get a judgement without prenotifying us and come take the stuff without prenotifying us.

Is this like the movies where one day they knock on your door to wipe you out even if you are in bankruptcy.

Here is a major question - can someone come in WITHOUT a judgement and take everything. Do they have to be given permission by a court to repossess?

[FilingOnMyOwn]

You need to consult with an attorney about all of this, preferably several of them. Whether or not they can force you into a chapter 13 will depend on how much disposable income you would have after your debts are discharged. If you qualify for a chapter 7, once your case has been discharged and closed, they would no longer be able to come after you as the debt becomes legally uncollectable.

[catwhisperer]

You need to consult with an attorney about all of this, preferably several of them. Whether or not they can force you into a chapter 13 will depend on how much disposable income you would have after your debts are discharged. If you qualify for a chapter 7, once your case has been discharged and closed, they would no longer be able to come after you as the debt becomes legally uncollectable.

Maybe my question is this - if we shut down the business, sell all of those assets, then they come after us personally and we have filed Chapter 7 - how much and how long could they pursue us - is our exempted property safe even from them?

[FilingOnMyOwn]

If you close the business and sell everything in an attempt to shelter your assets from them under the exemptions or otherwise, that would be considered fraud and you could land yourself in jail. You could however, simply go out of business, then offer to return any equipment you purchased using the loan.

Once you file, everything you have is protected under the automatic stay. At the 341 meeting of the creditors, the trustee would determine if any property will be taken. Most likely, you would be keeping your personal belongings and vehicle up to the allowable exemption, then any equipment or property you purchased using the business loan may possibly be taken back by the creditor or trustee.

You really need to speak to an attorney about all of this, several of them. We are not attorneys here and can't offer legal advice, only opinions.

[catwhisperer]

If you close the business and sell everything in an attempt to shelter your assets from them under the exemptions or otherwise, that would be considered fraud and you could land yourself in jail. You could however, simply go out of business, then offer to return any equipment you purchased using the loan.

Once you file, everything you have is protected under the automatic stay. At the 341 meeting of the creditors, the trustee would determine if any property will be taken. Most likely, you would be keeping your personal belongings and vehicle up to the allowable exemption, then any equipment or property you purchased using the business loan may possibly be taken back by the creditor or trustee.

You really need to speak to an attorney about all of this, several of them. We are not attorneys here and can't offer legal advice, only opinions.

No, the intent was to sell the business to pay the bank off and other creditors. We've been trying to get an attorney to return our call - we have to go with a more bargain basement one because we have no assets worth diddly squat and definitely no money.

Thanks for your help - I realize y'all aren't attorneys, just need something to calm my nerves.

[FilingOnMyOwn]

You could do that. But you have to make sure you are not preferencial in what you pay to who, as far as your secured and unsecured debt goes. First of all, get free consultations with attorneys that offer them, most do. Don't worry about the fee, all you're doing is window shopping and gathering opinions at no charge. A truely helpful attorney will be eager to address your concerns and problems and not shrugging off all the things you're worried about. When you do hit that attorney that the right one, you'll know it. It should hit you like a ton of bricks and set him apart from the rest. But you definately need one, don't worry about the fee. Theres way too much at stake for you to try and be cheap on getting a lawyer. If you have to sell something just to pay the fee, then do it. It will be worth it when your case doesn't get screwed up and you lose way more.

As for selling your business to pay creditors, this is something that the attorney would have to advise you about. If its possible, you would have to do so very carefully, as preference towards paying one creditor or another is another red flag and potential fraud issue. Its best to go out and collect alot of information and opinions before you make any decisions on what to do.

[no_it_all]

<snip> Sure, they will threaten you will all kind of lies, thats what collection people do.

Especially if you are heading to a no-asset Chapter 7 !!