Can I actually exempt 60k worth of vehicles?

[Samba]

I posted this in general by mistake and I think I should have posted it here:

I am in danger of defaulting on 12k worth of credit card debt. Looking into the possible future of being sued by Bank of America over this debt and having to file bk I have searched the internet for options.

I have two restored vintage vehicles, a 1959 show vehicle and a nicely done 1977 vehicle that I drive daily and one 2002 daily driver that my wife uses. All 3 in my name. My wife has a 78 convertible in her name that runs but has no roof.

My 1959 is insured for 40k, but could be worth more. I think my 1977 is worth 8-10k the 2002 might be worth 3k and the 1978 convertible is worth less than 5k for sure.

I found a link: http://markddunn.com/exemptions-table.html to a local lawyer here in Texas, that says one vehicle per person in the household up to $60,000. If I understand this correctly, we would BOTH need to file for bk and then we could keep 2 vehicles (the 1959 7 the 1977) under the 60k exemption and liquidate the other 2 if it came down to filing?

[brokejoker]

I would think it could be $30,000 per vehicle. A couple of thoughts though. Can you liquidate the cars on your own and settle the debt? It took almost a year and a half for a cc to sue us, could you save up some money in that time and settle the card? Have you called and tried to negotiate your payments with the card?

[Samba]

I lost my job 3 weeks ago and just began my job search. The vehicles are my pride and joy and the 1959 is more of an investment than anything else so I don't want to even think of liquidating it.

If I do get a job then I would have no problem saving up enough to settle. Heck I would have no problem taking out a loan against my 401k to settle if I didn't get a job. My 1st priority is the mortgage but my 2nd is keeping the 2 vintage vehicles.

[brokejoker]

If you are planning on liquidating the two cars in your BK anyway, I would sell them and take that $8000 and offer to settle the card. The cc will probably jump on that. Our settlement offers came in at about 30-40% of the debt.

I just don't think I would take the credit ding of BK over $12,000 - especially if I had some resources to attempt and settle. If they actually file a lawsuit and you have no way to try and pay then I would think about BK at that time.

[Samba]

Sound advice. If they offered to settle for 50% or less I would jump on that. I was worried that they would just sue me without offering me a settlement.

[brokejoker]

Ours went more like - late payment, calls galore, 3 months late, sold to collection agnency, more calls, some letters offering to set up payments, hit one year mark, then some offers for settling the debt at 30%-50%, then served with lawsuit. We only filed because they served us. Otherwise, we would have held out until our situation improved and tried to settle or let the statute of limitations pass and just let it go.

Bare minimum you should have three months or so before they even sell it to collections. You will still be getting phone calls so you may want to check out the collections forum for advice on how to handle those. Good luck!

[Samba]

Thanks for the replies. So I should jump on the 1st settlement offer to be safe. I realize things are different these days that's why I am concerned. I had to walk away many years ago (long story involving ex-girlfriend) and no one threatened me with a lawsuit until the statutes of limitations had expired so I didn't sweat it when they called. I told them I had spoken to an attorney and never heard from them again. I have more to loose this time around. If you don't mind me asking what was the bank that sued you? I was told Citi bank was quick to sue and that Bank of America was slow to sue.

[SMinGA]

There is no certainty on when/if a creditor will sue. Some factors will be what state you're in & your balance owed. (Some states make it easy/cheap for creditors to file small claims, while others may only sue if its a large balance. So no way to know how it will play out.)

Other than that - filing bankruptcy costs $1500-2500. And the TX exemption is per person about $30k (I don't know the exact dollar amount) and that would have to cover all you own. Not just the car, but value you own in furniture, cash, electronics, etc. And the valuation would depend on your district. Might turn out the vehicles are worth more than you think, you could end up paying legal fees AND have one of the vehicles sold by the trustee to pay the debt in full. With the trustee taking a cut.

Unless there is much more going on, more debt and/or lawsuit imminent then don't rush into bankruptcy. Besides, if you are not working then you cannot be garnished. (And I'm thinking TX may be a no garnishment state?) So if you end up with a lawsuit, just keep your bank account low.

[bigtim6656]

A friend of mine had his card stolen and they offered him 50% when they put it on his credit and swear he bought the 2500 purse from Europe. HE said only have of it was his charges and they said they could take the other off which is about half and 20% off the other.

[bigtim6656]

That is true, When a debt collector called me for a big debt I have he said he would garnishee my income. I laughed and said you can not I am on SSDI. We all know that ant happening. He then said they do it all the time and can take 80% of my monthly check I told him, "I tell you what you get one penny out of my ssdi check ONCE and I will pay the bill in full in cash" He then asked if I was making a offer to pay the full amount. I told him only if he was able to garnishee my monthly check. A few weeks later I got another call this time someone else. They told me they had setup a garnishment with the SSA office and if I did not pay the amount they would get 50% of my check I laughed and told them I was glad they was able to find away to be the first person in the world to GARNISHEE SSDI OR SSI PAYMENTS

Odd thing a month ago the bill was charged off. YOu might setup a reduced pay off, then sale the 2 cars you know your losing and avoid bk. Heck why go through it then have to still pay it.

There is no certainty on when/if a creditor will sue. Some factors will be what state you're in & your balance owed. (Some states make it easy/cheap for creditors to file small claims, while others may only sue if its a large balance. So no way to know how it will play out.)

Other than that - filing bankruptcy costs $1500-2500. And the TX exemption is per person about $30k (I don't know the exact dollar amount) and that would have to cover all you own. Not just the car, but value you own in furniture, cash, electronics, etc. And the valuation would depend on your district. Might turn out the vehicles are worth more than you think, you could end up paying legal fees AND have one of the vehicles sold by the trustee to pay the debt in full. With the trustee taking a cut.

Unless there is much more going on, more debt and/or lawsuit imminent then don't rush into bankruptcy. Besides, if you are not working then you cannot be garnished. (And I'm thinking TX may be a no garnishment state?) So if you end up with a lawsuit, just keep your bank account low.

[jazzop89]

Can you liquidate the cars on your own and settle the debt? It took almost a year and a half for a cc to sue us, could you save up some money in that time and settle the card?

You are clearly not a car nut. I understand the OP's dilemma. Liquidating a classic car is never an option. Suicide or a Waco-style standoff is literally higher on the list for me.

[brokejoker]

You are clearly not a car nut. I understand the OP's dilemma. Liquidating a classic car is never an option. Suicide or a Waco-style standoff is literally higher on the list for me.

He was talking about keeping the classic cars and liquidating the other two cars in the BK. And no, I'm not a car nut but I do live with one. One who wouldn't file BK until he was assured that his project car was safe. LOL

If you don't mind me asking what was the bank that sued you? I was told Citi bank was quick to sue and that Bank of America was slow to sue.

We were sued by BOA and CapOne.

[Samba]

I'm not sure why the thread notifications started going to my spam folder? I just noticed a few moments ago. Two months into Mr. Mom status and I can safely say that I will not be filing BK. I have gained perspective from the passage of time and the many helpful responses on this site, as well as some research on my own.

I have less than 12k in cc debt and only one card. I have far too much value in my vehicles to protect them under BK. I still have about $100 credit available and have not fallen behind 30 days yet so technically the clock on defaulting to settlement to lawsuit hasn't started ticking yet. I have had 2 second interviews this week and next week will find out about one job and have a 3rd interview on the other one. So i think if I can tread water for a few more months I should be fine.

I talked to a friend of mine who ran into an interesting situation with BOA. He is a business owner and had 4 cc. He almost maxed them out so BOA automatically upped his rate to 30% so he stopped paying. 2 months went by and he told them he was out of work and would not pay that amount of interest. They offered him the same thing they did me. Close the account, make a specified monthly payment with an automatic deduction from his account for at least 12 months and continue to pay for 5 years and all would be taken care of. He said there is no way I am gonna allow you to automatically deduct from my account. Hung up and called back and told the next person that the previous person had agreed to that. They gave him a hard time and he never answered the phone again ( he gave them a Magic Jack number to call) and sent in the payments on his own. He noticed that after 4 months or so his credit report reflected that he was now making payments on time

I got a call Thursday from BOA and this guy was a slimy as a used car sales man complimenting me and being all buddy, buddy with me until I found out that what he was after was an authorization to set up a pre dated withdrawl from my account for the payment next week! Technically I am still current and not over the limit ( I thought I would have been but they got rid of late fees) and this guy wanted me to set up an automatic withdrawl. I know it's because I tried to figure out my options a month ago. He suggested that I see about deferring a car payment to get back on track with my BOA cc. I told him I tried to take advantage of BOA's home retention program by trying to qualify for 3 months mortgage deferral but got the rubn around for 3 hours by getting re routed 15 times and hung up on twice only to finally gey info to the 'right person' who evidently didn't insert a 'stencil' in my file. I got a robo call a week later telling me that a rep would call me in 10 days. 11 days later I spent 2 hours on the phone getting re routed 17 times and hung up on twice, was told bby the guy in India that dept no longer existed but finally got a hold of some smarmy shlub in AZ that had the nerve to tell me that not only did I need to start the process over after 20 days, but that BOA was not in the business of charity and BTW it could take up to 12 months to get approved for my 3 month deferral. I told him if I was still in need of the deferral in 12 months I would be in this house. he had the nerve to say that BOA was not in the business of charity and that it was my responsibility blah, blah blah. I told him it was in BOA's best interest to keep me in this home since pre-existing home sales were basically non existent and I was tryning to take advantage of a program THEY offered. As of today I still have not received my packet to fill out and send back and I'm sure I never will, no matter how much time I spend navigating the rude and indifferent, condescending pricks at BOA.

[tobee43]

I got a call Thursday from BOA and this guy was a slimy as a used car sales man complimenting me and being all buddy, buddy with me until I found out that what he was after was an authorization to set up a pre dated withdrawal from my account for the payment next week

!

and you now should watch your account very carefully!! chase pulled that on us. i had done on line payments to chase...NOT auto payment...but just ON line.

i couldn't believe it when they just simply pulled the money out automatically....chased claimed i had authorized auto payment on line?? excuse me...and when was that. i asked for proof...of course none...so i had to go to my bank and file fraud charges against chase for illegally withdrawing my funds...my bank was saying NO...you have paid chase via automatic payment before.......NO...that was NOT auto pay...it was ME personally making an ON LINE payment...not the same animal, i never authorize anyone to take payments.

so the bank goes to chase who now insist that i not only approved the withdrawal on line, but now claims i did it by phone as well...oh...sure...so i told my bank have them prove it or give me back my money....

i got back my money...but warn your bank in advance just in case if you ever made any on line payments which many of us do, they just go in an rip it off!!

[helpmeout]

I lost my job 3 weeks ago and just began my job search. The vehicles are my pride and joy and the 1959 is more of an investment than anything else so I don't want to even think of liquidating it.

Feeding your family is more important. And the CC companies can go after all of your assets should they get a judgement. Taking out a loan on an exempt asset is not a good idea.

You may want to reconsider your priorities.