DMI versus assets

[bleakhouse]

Hey folks,
Hope everyone is having a nice day so far.

I have a couple of questions. Is DMI the only number that matters in a 13? I have about 20k in stocks, not 401k. Can the trustee make me liquidate them and use the money to go to unsecured debt? And, if I get a tax return, do I sign a check to the trustee for the amount?

Thanks in advance!

[LadyInTheRed]

If your stocks cannot be exempted using your state's exemptions, you can keep the stocks as long as your unsecured creditors get at least $20k during the life of your plan. If your DMI is not sufficient to fund a plan that gives that much to unsecured creditor's, the stock will need to be liquidated. The plan must insure that unsecured creditors get at least as much as they would in a Chapter 7 liquidation.

If you get a tax REFUND (a return is the document you file every year, a refund is the money you get back if the return shows you overpaid your tax), whether you get to keep all or part of it depends on your district and how your plan is drafted.

[bleakhouse]

Thanks LadyInTheRed!

I have another question.

I was sued in California for the second mortgage on one of the rental properties that I had. The collection agency won a default judgment in February 2010 and I was preparing to file 13. But I received a letter today saying the judgment had been vacated.

How could this have happened? Can another collection agency come after me? I do not live in California now, can the same collection agency or a different one come after me in the state that I currently reside?

Still scared.

[SMinGA]

Something to check into: if the 2nd mortgage was for purchase money, I do not think that you can be pursued in CA for a deficiency balance. Look into that, but if I am remembering (from other posts) correctly - that could be why they vacated the judgment?

Best to ask an attorney of course, about what creditors may or may not do...

[bleakhouse]

Thanks SMinGA.

I'll look into it. But I thought they could come after you for a deficiency balance if the purchase money was not for a primary residence but rather for a investment property.

I need to contact a lawyer to see if this vacated judgment in California can be bought by another collection agency who will then pursue me or whether the same collection agency can sue me in the state where I now live.

[LadyInTheRed]

Thanks SMinGA.

I'll look into it. But I thought they could come after you for a deficiency balance if the purchase money was not for a primary residence but rather for a investment property.

That is my understanding as well.

I need to contact a lawyer to see if this vacated judgment in California can be bought by another collection agency who will then pursue me or whether the same collection agency can sue me in the state where I now live..

A judgment is usually vacated on the motion of the defendant. It's odd that it was done without you taking some action. Depending on what county the case is in, you might be able to look up the documents filed in the case on the court's website and find out why the judgment was vacated.

[bleakhouse]

A judgment is usually vacated on the motion of the defendant. It's odd that it was done without you taking some action. Depending on what county the case is in, you might be able to look up the documents filed in the case on the court's website and find out why the judgment was vacated.[/QUOTE]


I know, isn't that strange! I'm afraid that it's a hoax. I'm going to see what information I can find in California. Maybe the judgment was simply vacated in California so they can try to pursue me in another state?

[LadyInTheRed]

I suppose it's possible they discovered you no longer lived in California and therefore the California court didn't have jurisdiction over you. But, I'd think that once they had the judgement, they'd take it to your state and try to collect and let you bring up any deficiency.

What county was the lawsuit in?

[SMinGA]

Out of curiosity - were you ever served? If they only attempted to serve you at an old address in CA, and did not actually serve you - then the judgment would not be valid. Still strange if they vacated it on that basis, normally would require you to get the ball moving to show they never properly served you.

[bleakhouse]

Hey LadyInTheRed and SMinGA,
I was never physically served; they delivered them to an old address. But it still is strange that the judgment was vacated. The letter says that the premature judgment is vacated. The lawsuit was in Sacramento county.

I've been reading around and it seems like the collection agency can just re-file and pursue me again. Although this past judgment was vacated, they can, and probably will, try to serve me properly and then sue me again. I'm still looking at a 13.

[SMinGA]

Could be they were required to submit proof of service, and when the court realized it was missing - the vacate order was entered. Kind of like how one can file an incomplete BK petition - yet it won't be dismissed unless the missing docs are not submitted in XX days.

They can, and might, try again. This has bought you time however.

[LadyInTheRed]

You can search for your case at https://services.saccourt.com/indexs.../CaseType.aspx. You should be able to view filed documents and determine what happened.