Filing Chapter 7 in California

[kasey227]

My husband and I are near the point of filing for chapter 7 bankruptcy. (California) We have a 2nd home which we own outright which are have been trying to sell for the last several months in order to pay off about 75,000 in debt. Our current income consists of only our social security (less than $2000/month), and that is used up each month paying our credit card bills. Our day to day living has come from savings and - oh gee - credit cards. We have 2 questions (for now):

1. We plan on surrendering the 2nd home as we have had no luck selling it. (The house needs a lot of work - electrical, plumbing, pest control.) At what point does the trustee take the home, and will the discharge have to wait until the house is sold & creditors paid? Are we responsible for property taxes & insurance once we surrender it?

2. If we are planning on filing in late January, can we stop making credit card payments now (and stop using our credit cards)?

We plan on filing pro se unless we can find a local bankruptcy attorney. So far not much luck in that respect.

Any help appreciated. Thanks.

[TXskyblue]

Regarding question 2, the account has to go 30, then 60, then 90 days past due. Then it charges off at 180 days. You will be fine to stop paying now and to file in January. Expect phone calls.

[Drazil65]

Hi and welcome, my best advice is start reading here, everything and then start reading again. Your best bet is to make a few atty appointments for the "free" consult at least especially if you are going pro se. With the questions you are asking it appears you have a lot of research ahead of you so those consults will provide a lot of feedback and guidance for your specific case. Not sure why you cannot locate a bankruptcy atty in your area but go to another area if you need to.

I would also suggest you search for "google voice" here on these forums and set it up, can be a blessing where creditor calls are concerned, Knowledge is your best defense and you will need a lot. If you know you are going to file and have a timeline for that then you should stop paying all unsecured debt and STOP using the credit cards as well.

You mention the 2nd home (and as it is paid off I am not sure how that is handled) but are you surrendering the other home which I assume you are living in? Is there a mortgage on the primary? If so make sure you read the stickie at the top of these threads regarding NOT reaffirming the mortgage. Also, make sure you have a plan for after the bankruptcy is over and that you can afford to live within your means without credit cards, this is your chance to have a fresh start, use it wisely. Good Luck!

[kasey227]

Thanks for the replies. Yes, we have much research to do - getting started now! Really appreciate this forum. We've downloaded all the forms/schedules, and feel like we have a fair understanding of how to proceed.

We own both our homes outright, but neither is valued more than $95,000. We will be using the California homestead exemption for the primary. If it weren't for the 2nd home, this would be a no-asset case. Our car is 14 years old and blue book value is about $1200. Other than normal furniture and a couple of older computers, we have no assets.

As far as attorneys, we live in a very small town in Northern California. Seems all the attorneys here are criminal law or business law. Found 1 possible, but he doesn't have a local number - probably a cell phone. We will probably give him a call for a free consult. The rest that are listed are the 1-800 type. The bankruptcy court is 80 miles south of here, and there seems to be plenty of attorneys there, but we'll keep trying for a local.

Again, thanks for the help. Going to start reading now!

[avengers]

We stopped paying our credit cards in November of 2013 and didn't file chapter 7 until October of 2014. You'll be fine not paying the cards. The most that'll happen is phone calls and you can just set your phone to no longer accept those calls.

As for the attorney, just set up a day to visit 2-3 attorneys 80 miles south of you for the free consult. There's no real reason to have a local attorney (e.g., Fortune 500 companies deal with out of state attorneys all the time). You only really have to meet them in person once. After that, all your dealings can be via phone or email.

[kasey227]

Well, we went ahead and filed on December 14, and had our 341 yesterday. whew! We were the only pro se out of 12 cases, and we were the last ones up! The attorney who handled 8 of the other 11 cases came up to us and offered to "be here if we needed him", but fortunately, we didn't. Everything went smoothly. We get to keep our boat!! (no motor or electronics, but hey - great lawn ornament.) Our second home will be sold by the trustee; we sent her info regarding capital improvements and depreciation which she is forwarding to the accountant, and we met today with the realtor who will handle the sale. Probably looking at 6 months before discharge. Creditors should be pretty happy, too.

All in all, very painless. A very kind and considerate trustee.

[kasey227]

Well - today is day 60!! So far, so good. The house (our second house) was sold by the trustee and escrow should close on or about April 1. The trustee has hired her accountant and attorney. The creditors have until April 27 to file proof of claim.

Please, correct me if I'm wrong - the discharge should be coming very soon, but the case won't be closed for probably another couple of months - June or so?

This has been the fastest - yet the longest - 3 months of my life! But I think it's about done.