How do I start?

[iupui1299]

Well, this is my first post. My wife and I are going to be heading down the road of I believe a chapter 7 bankruptcy. My question is....do I go ahead and do the pre-credit counselling classes first or meet with a lawyer first? Thanks in advance!

[annikasaunt]

Do a few free consultations with some different attys and see if you like any of them. They will tell you everything you have to do. The pre bankruptcy counseling is only good for a certain amount of time before you file. I did mine after meeting and hiring my atty.

[SinkingFast]

The pre-BK Cert is good for 180 days, or approx 6 months. But,.........

Anything you do like paying a retainer or doing the pre-BK Cert thing kinda sets a timeline for when you KNEW you were gonna file.

Say you're waiting out your 70/90 day time periods,........... If you pay an attny a retainer or get the pre-BK Cert done, your Creditors have a specific point in time they can bring to the attention of the Court when you KNEW you were filing BK.

Go visit with attnys. Consults are free. You'll get different perspectives from different attnys. Spend time researching on your own as well. Attnys won't tell you everything you need to know to prep for filing BK.

Like pay bills and rent with Cashier's Checks and Money Orders instead of personal checks. Money is instantly gone from the checking acct that way. Other little tidbits like that.

[iupui1299]

Why should you pay rent with money orders or cashier's checks?

[SinkingFast]

In our case, our Landlord was taking weeks, and longer, to cash our rent checks. Any bills you pay by mail take at least a week to process.

The day you file sets your BK Estate, for the purposes of the Court. Whatever money is in your checking acct on that day belongs to the Court, unless you have some way to exempt it.

If you write checks to pay bills, and those checks aren't cashed before you file, you could have checks bounce.

Using MO's and Cashier's Checks gives you control over your money.

Purchase a MO using your debit card for your electric bill, the electric bill get's paid, and the money instantly leaves your acct. Get a Cashier's Check for your rent or mortgage payment, your rent/mortgage get's paid, and the money is instantly gone from your acct.

You don't have to worry about the funds sitting in the bank on the day you file, checks bouncing, or your bills being paid.

[iupui1299]

So if I have direct deposit through my work should I get that stopped? Basically, make sure no money is in my account?

[djk]

your state may have an exemption for earned wages, many do. if the bank/credit union where you have the checking acct is also one of your creditors they may freeze or close the acct after you file. mine did not, but I've read other posts that it did happen. many open a new acct. shortly after they file, this avoids having to include it in the petition and also eliminates the checking acct/creditor relationship if there is one.

[SinkingFast]

your state may have an exemption for earned wages, many do. if the bank/credit union where you have the checking acct is also one of your creditors they may freeze or close the acct after you file. mine did not, but I've read other posts that it did happen. many open a new acct. shortly after they file, this avoids having to include it in the petition and also eliminates the checking acct/creditor relationship if there is one.

What DJK is talking about here is Cross Collateralization. I think that's what the banks call it.

Say you have a checking acct and a CC with a bank, or a checking acct and a loan you're going to include in BK with a Credit Union,............ Somewhere in the fine print of either the loan or the checking acct, you gave the bank the right to take funds from checking to cover any deficit on the CC or the loan. When you file BK, if you have that situation, you could loose all the money you have in checking to your bank. Depends on the line of credit you have with them. It has happened to some people who've posted here.

We did arrange to stop direct deposits for the time being. This way we can control when the funds go into the checking acct.

Since you have to declare any bank accts you've closed within the last year, the balance, and why when you filed BK, don't close your current acct. If you're worried that your bank will give you problems post BK, go out the very next day after you file and open a new acct with a new bank. There are 2 reasons working there. The day you file sets the BK estate in the eyes of the Court. And, your BK won't have had time to hit your Credit Reports yet, if the bank happens to do a pull on you. It doesn't take long after you file BK for it to start being reported on your Credit Reports.

[FoolAndHisMoney]

The pre-BK Cert is good for 180 days, or approx 6 months. But,.........

Anything you do like paying a retainer or doing the pre-BK Cert thing kinda sets a timeline for when you KNEW you were gonna file.

Say you're waiting out your 70/90 day time periods,........... If you pay an attny a retainer or get the pre-BK Cert done, your Creditors have a specific point in time they can bring to the attention of the Court when you KNEW you were filing BK.
Go visit with attnys. Consults are free. You'll get different perspectives from different attnys. Spend time researching on your own as well. Attnys won't tell you everything you need to know to prep for filing BK.

Like pay bills and rent with Cashier's Checks and Money Orders instead of personal checks. Money is instantly gone from the checking acct that way. Other little tidbits like that.

You're certainly correct about retaining a lawyer, but the "pre-BK Cert" is just credit counseling and that should be ok sooner. That's what the new law was designed to encourage, 1st counseling and if you can't qualify (as most probably won't), then bankruptcy filing. Going to counseling soon may show that you tried to work things out in good faith sooner.

[SinkingFast]

You're certainly correct about retaining a lawyer, but the "pre-BK Cert" is just credit counseling and that should be ok sooner. That's what the new law was designed to encourage, 1st counseling and if you can't qualify (as most probably won't), then bankruptcy filing. Going to counseling soon may show that you tried to work things out in good faith sooner.

I don't know if all of them are doing the same thing or not.

Back in January, we used CCCS of Atlanta to give us a professional opinion of our financial situation and our options. They also prepared a DMP for us at that time as well. We thought we were BK bad off, but when we saw the CCCS report our fears were confirmed.

Fast forward to hiring an attny. We had our appt scheduled for the Consult. Basically this was the face to face meet and greet. We'd already chatted with them twice on the phone for over an hour each time. Went back to CCCS of Atlanta for the pre-BK Cert.

CCCS sent an entire packet of info. Included in that packet was a statement that a DMP had not been prepared for us as a part of the Counselling Session. So when we turned in our docs to the attny, I included a copy of our first contact with CCCS showing we had indeed had a DMP prepared.

That's why I was recommending waiting until closer to the time you're ready to file. The CCCS packet made it look like we hadn't really gotten any recommendations from them. Just the pre-BK Cert.

Also, the attny you select may have some reason for waiting a while to file. Or you may have a life circumstance arise that you'll need to wait. We're in the process of trying to find suitable replacement rental housing. And I know from reading others' experiences, no one will rent to us while we're in the BK process. If we're a Ch 7, landlords are gonna wanna wait until discharge. So we need to get a rental lined up before we actually file.

[iupui1299]

We were going to look for an apartment as we are going to file on our mobile home. Will having a co-signer help us get a place? Or should we go ahead and get a place set up before we file?

[SinkingFast]

We're going thru that right now, IU.

I know from having read on here that nobody will touch you while you're in the process. Once you file, you're dead in the water for Credit, getting an apt., anything like that, until you're discharged.

Our credit is crap. We've found a place we're interested in. It's professionally managed. The people who built it, a pair of guys, are professional construction contractors that own their own company. One of the guys' wife is a Real Estate agent. She will handle the actual leasing of the property. They also have a full time maintenance guy that works full time for them and no one else. All in all, it sounds like a much better situation that the one we're currently in with our present Landlord. So, I'm gonna call the REA and tell her about our credit situation, what's going on with our house, and see if they will even consider us. No sense fooling around with filling out the lease and forking over a security deposit if they don't accept us. Just a waste of both their time and ours.

[iupui1299]

So basically my options would be to get an apartment before I file or wait until after I am discharged and use a co-signer?

[aa06a47]

So basically my options would be to get an apartment before I file or wait until after I am discharged and use a co-signer?

That is my opinion. If your credit isn't already crap, then you might be good to get one prior to filing. Landlord are kinda like credit card companies, they like people ready, willing, and able to pay. Once you have that bk blackmark, you will find it more difficult.

[aa06a47]

So basically my options would be to get an apartment before I file or wait until after I am discharged and use a co-signer?

Another red flag for them, if you don't have a bank account and try and pay with cash your rent. I know you want your balance relative low prior to filing, but make sure you pay your deposit / rent with a check. If you go in there with cash or money orders, red flag pops up. I use to own rental property, and I learned the hard way, folks who pay deposits and first months rent with cash, generally don't pay at all once they are in.