Opened up a bar with two other partners. It failed and I'm left with 90k in cc debt, 8k Leased equipment that landlord won't let us remove from building....this may end up in a lawsuit. Landlord is trying to sue for not finishing lease on building. We have some liquor bonds that need to be paid....for liqour taxes owed to TABC. I'm really trying to avoid chapter 7 but I think in this case...it would be wise. If I didn't have the lawsuits....I would just settle with cc companies. The thought of ch 7 freaks me out. Any advice?
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The need to escape crushing debt from a failed business is exactly what bankruptcy was invented for. Depending on how the business was set up, and if you signed any personal guarantees for the business's credit cards, building lease, and/or equipment leases, you might be sued personally for damages by various creditors. Bankruptcy would certainly discharge all of these debts, except for the liquor taxes, which are probably not dischargeable.
Of course, you should consult with an attorney to decide if bankruptcy is the best solution, because some states have very lousy exemptions, and in such a state you could lose more by filing than you would by simply having judgments. Assuming that bankruptcy is your best option, and attorney can advise you on how to time your filing so that you give up as little money and property as possible. The essence of bankruptcy planning is to time one's filing so that non-exempt assets are at a minimum on the day that you file. For example, if you have money in the bank, but know that you will need any medical care, car repairs, or home repairs in the near future, then it is best to spend the money, see the doctor, fix your house and car, and then file. You are also allowed to stock up on food and necessary medication before you file. -
Most people don't lose any property that they want to keep in BK. What most people lose are houses and cars that they couldn't afford in the first place. Your profile says you are in Texas. Property exemptions in Texas are pretty generous: http://www.nolo.com/legal-encycloped...xemptions.html. Texas also allows you to use federal exemptions if they work better for your mix of assets.
With that common fear addressed, what about Chap 7 freaks you out? Post some specific fears and questions and we can probably help put things in perspective.
Most bankruptcy attorneys give free consultations. So, meet with 2 or 3 until you find one you like.
LadyInTheRed is in the black!
Filed Chap 13 April 2010. Discharged May 2015.
$143,000 in debt discharged for $36,500, including attorneys fees. Money well spent!Comment
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I've always had excellent credit....not having any lines of credit is hard for me to get use to. Losing my job and then trying to find another with a Ch 7 on my report. I'm turning in all paper work tomorrow with a good attorney. My first attorney told me ch 13 and only wanted to charge me $700...that cheap price was a red flag. My new attorney is getting me approved for a ch 7 and is very informative...what a difference.Comment
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I filled out all of the necessary paperwork....I was 95k in the hole with two law suits......I'm feeling so relieved now. Thanks for everyone in these forums.....thanks for sharing your story.Comment
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It is a big relief, isn't it. Congratulations on taking this step to a financial fresh start!
Create a budget for yourself and stick to it, so you will not miss having a line of credit.LadyInTheRed is in the black!
Filed Chap 13 April 2010. Discharged May 2015.
$143,000 in debt discharged for $36,500, including attorneys fees. Money well spent!Comment
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