Bets On Who Is Going To Blink First (Mother vs Cap. 1)

[debee]

I don't know the particulars for TN, but the BK code provides that the trustee can avoid a lien to the extent that it impairs an exemption. So if the creditor gets a judicial lien that eats into your Mom's allowed exemption on the house, it can be avoided by the trustee during the BK filing. Also, the creditor is last in line in terms of proceeds from sale - so the first mortgage holder comes in first, the second gets dibs next and so on down the line with the creditor getting whatever other scraps fall off the table.

[BrokeIn2010]

Your mom could file an Emergency Petition. Then she has 15 calendar days to get the rest of the schedules submitted. But that filing date and case number will kick in the Automatic Stay.

I'll let her know and have her give the lawyer a call.

I agree that it is best not to get a Judgment. Why can she not go bk sooner? 'Hub

The 8 year age out. It's up at the end of this month, but the court date is this week. I figure they won't be able to get a discovery hearing before her filing though-- if I understand the whole thing that the Judgement and Discovery process are two separate things.

[AngelinaCat]

Your mom could file an Emergency Petition. Then she has 15 calendar days to get the rest of the schedules submitted. But that filing date and case number will kick in the Automatic Stay.

[AngelinaCatHub]

That's what I always thought. But her attorney told her that if they get a judgement and get the lien during/after the asset discovery they can use it to force a sale if she misses a payment. Apparently that's why he trying to settle it, even though he's filing a Ch. 7 in a couple months: he doesn't want them to try to force a sale through the BK court.

I agree that it is best not to get a Judgment. Why can she not go bk sooner? 'Hub

[BrokeIn2010]

That's what I always thought. But her attorney told her that if they get a judgement and get the lien during/after the asset discovery they can use it to force a sale if she misses a payment. Apparently that's why he trying to settle it, even though he's filing a Ch. 7 in a couple months: he doesn't want them to try to force a sale through the BK court.

[AngelinaCatHub]

Everything sounds about right except the lien forcing a sale. Usually a lien will be against the house and even in bk won't be lifted. A Judgment can be set aside. But a lien is satisfied upon payment when a thing is sold. It cannot force a sale unless TN law is far different from most other places. I doubt that any Judge would put a person on the street for a CC balance. 'Hub

[BrokeIn2010]

My mom got sued over a Cap. 1 card. She had tried on of those Debt Management things (trying to avoid filing BK) and got took. She was under the impressions (from their own forms) that they were going to settle the bills and the they were working with his creditors. Long story short, in May Cap. 1 sued, and are no claiming that they never spoke with the DM agency of received dime one from them.

She goes to the family attorney, he pushes off the court date. Says "Don't talk to them, I'll talk to them". Fast forward to this past week: They're got a new court date (next week) and no Mom's attorney is trying to get them to settle or set up a payment plan through his office. He hasn't heard back from them, and he's thinking they're going to take it right up to the courthouse steps hoping she'll settle for at least 60+%.

He's filing a BK case for them in January, but he doesn't want them to get a judgement cause he doesn't want them to get a lien on the house; cause if they get a lien on the house and she misses just one of the court arranged payments (before the BK is filed and the stays kick in) on the judgement they could force a sale of the house.

I asked about the lien, and he says that they can't force a sale of the house unless she refuses to pay the judgement and/or doesn't discharge the underlying debt in a BK action. And they won't get the lien next week, they'll get a judgement and then (if they can get a date before he files the BK) they'll be a second hearing/discovery where they'll put in their requests for whatever collections of liens process they'll take. Does that sound about right?