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**vic6string** · 04-14-2005, 01:04 PM

I don't see why everyone is so scared of chapter 7. Depending on where you live, you can often times keep your home, keep your car (as long as you have a means to pay for them) and your credit is no worse (in fact usually better) right after a BK7 as oppossed to BK13. Once you fall into the rut where you can no longer make payments or are just getting by on minimum payments, your credit is often as bad as it is going to get. Once your credit is shot, why would you want to pay off your debt while keeping the bad credit score? Chapter 7 lets you wipe the slate clean, and allows you to start over from scratch. Cleaning your credit report and keeping up on your bills and having good habits (especially when you have a good paying job) can get your credit score back up to at least average within 6 months to a year. Chapter 13 handcuffs you until you're done with the plan, and many people have their plans extended. You are doing the right thing. Talk to both lawyers. Listen to both. Ask them anything and everything that enters your mind. Think of stuff and write it down before the meeting and take your list of questions. But don't be afraid of either BK 7 or 13, and don't think of yourself negatively if you do file for BK. It isn't just a scapegoat for losers. It isn't a crime. You are no less of a person if you go ahead and do it. Good luck.

**Bob_Dole** · 04-15-2005, 08:30 AM

The main goal under any filing in bankruptcy is to give one who is burdened with debt a Fresh Start. A Chapter 7 Bankruptcy is the most common form of bankruptcy filing, accounting for over 65% of all Consumer Bankruptcy filings. This process involves the appointment of a trustee. A trustee collects all non-exempt property, sells the assets and then distributes the proceeds from the sale to the appropriate creditors. However, unlike other bankruptcy filings, a debtor does not make payments to the trustee.

Does this mean that you will lose your assets? The answer depends on your particular situation.but in most bankruptcy cases you will not lose any of your belongings. If you feel that you may lose some of your possessions, discuss it with your Bankruptcy Attorney

**The Big B???** · 04-15-2005, 09:29 AM

Thanks for the feedback from you both.

I met with attorney A this morning and he gave me 1 hour of his time at no charge and with no strings attached. After doing so I feel a level of relief and have uncovered the following:

1. I should wait at least 1 more month before doing anything to further separate myself from my credit card and loan activity (I had done some cash withdrawals in the late fall to come up with the final payoff that was needed to keep my share of custody of my son).

I should also use that month to finalize my life insurance plans that I'm currently enacting so as to not have a bankruptcy interfere with that.

2. He felt that my household income was a little too high for a chapter 7, however due to my circumstances I still may be able to file one. I'm supposed to put together a complete breakdown of all income and expenses in the house (including my wife's, although my wife will not be a part of this bankruptcy, her income and expenses are still part of the equation).

3. Should the expenses not outweigh the income substantially I may be a better chapter 13 candidate and after going over the figures he would be able to tell me wich was the best course of action. He said that normally it is best to shoot for the 7 and then go 13 if it does not work (dismissed), however in some cases it's best to go 13 and show the effort and then if things do not work for you, at that point go to the 7.

4. My "case" is not your average case due to the factors involved (very recent home purchase seemingly right after acquiring the debt), (the 2001 tax situation being in court status now, shows a potential fraud on my part), maxing out available credit to pay off the ex wife and then quickly filing BK), (the unsecured MBNA loan that is $40,000 by itself). He said that he would have to put more detail and effort into my case because of these things and thus would have to charge me a little more to do so...Price quote $1500 plus the $200 for filing and he would work out payments.

5. He told me that as long as I am current and paying on my home and car there is no reason to fear losing them. There is no equity in either. He also said that as far as personal belonging etc., he normally just puts "misc. household furnishings" on the paperwork and leaves it very generic with a dollar figure of $2,000 or so. He said that Trustees are looking for assets that they can turn into $...Vehicles and property mostly. "In the 15 years I've been doing this a trustee has never gone to look over a client's personal belongings in their home".

So that is a snapshot of this morning. I feel somwhat releived as I know that even a 13 will ease my pressures if things go that way. At this point I plan to use the next few weeks to keep sitting with BK attorneys to hear more opinions and gather more knowledge and info, finalize my insurance, and gather any and all necessary docs and info that will be needed for this.

One last thing that did give my Dad a red flag when I mentioned it is that attorney A was located in a shared executive space and did not have his own office. He seemed to feel that could mean "fly by night".

I meet with attorney B tomorrow morning, a little wiser but still confused.

Again, any and all insights and help from those on the board is welcome and very much appreciated.

Thanks

**The Big B???** · 04-18-2005, 10:43 AM

Met with the second attorney on Saturday who gave me roughly 20 minutes of his time at no charge. He was very sure about a 7 in my case and even said that I could throw my back taxes from 3 years ago into the bankruptcy as well. He told me that it was worth a shot. Made everything seem very simple. Literally that the process was hiring him, filling out some papers, then 6 weeks from now a simple question and answer session similar to the one we had that morning by a trustee and that's it. Total cost for this attorney was $875 (he wants half up front plus the filing fee.) He also said that if I file next month, that I should not even bother making my payments on my cards for this next pay cycle. "what's the point of giving them the money" I find that last bit a bit tough to swallow psychologically. I've never been late on payments as far as I know, and perhaps I'm just conditioned to make them?

I've just pulled some more ads from the yellow pages and plan to get a few more meetings in over the next week or so. Attorney number 2 from Saturday morning was one of the largest advertisers in the phone book as well.

Another question for the group...I forgot to mention this to the attorneys I have met with. I have 2 attorneys that I had used in the early stages of my divorce. They were both bloodsuckers. The first was a high profile firm, they rang up the bill hard and heavy. When I finally dropped them I still owed them about $1200. I had no money to pay. I stopped answering their calls and letters. Eventually they stopped calling. They never blemished my credit report. The second was a crook who soaked me for thousands. I should have known better but frankly, when your child is involved and your desparate for help, you just make stupid decisions. In the end I think I owed him at least another $6000 based on his handwritten receipts. He was a one man show. He never came calling for the money and is on the other side of the country with no idea of my whereabouts. I cut my relationship with both at least 2 years ago. So the question is, if I do this bankruptcy, do I throw them both in as well? If the bankruptcy gets dismissed, have'nt I in effect made them aware of how to find me as well as essentially admitted to oweing them the money? I truly don't feel that I should be obligated to them due to feeling robbed by both.

Last question, during a conversation with an attorney last week over the phone, he said that you can't pick and choose who you are throwing in for bankruptcy purposes. That still has me confused as I am not behind on my car or house and do not wish to have either involved. Any insights and help is appreciated.

Thanks

**vic6string** · 04-18-2005, 11:38 AM

1) I would throw the attorneys in. You don't want to start over clean and all of a sudden have thousands of dollars of bills from some collection agency. Trust me, they will wait til the last few days before the statute of limitations hits and will start calling.

2) Stop paying the cards. As he said, why pay them if you are filing anyway. You are going to take the credit score hit, why pay them for it?

3) You can't pick and choose which debt you will throw in as for your unsecured stuff. If you can pay keep paying for your car and house (and they fall into your exemptions) you can keep them. What he means is you can't keep your American Express card but discharge your Citibank card. It is all or nothing. Now, if you have a $0 balance on a card, you don't have to include them, but they may cancel your card anyway once you file.

**The Big B???** · 04-18-2005, 11:47 AM

Vic,

Thanks for taking time to try to help. This whole thing has gotten a lot less scary since I've started really finding out about it. I have to be honest when I tell you that it literally sounds too good to be true. Fill out some papers, have a 5 minute interview and start over with no debt. I know the ramifications of a BK and frankly do not fear them. I have not used my cards for anything other than the divorce in the first place. I've only lived on what I make and other than buying my car, my credit has not been too much of an issue. My wife holds the mortgage on the new house, I'm only on the deed.

Am I wrong in believing that it's really this easy? I know that there has to be another catch somewhere, but to be honest, dealing with credit in the dumpster for a decade or less, sounds alot more appealing then being stretched beyond my limits financially for that same amount of time if not longer with terrible credit to boot.

Am I missing something?

**LinSC** · 04-18-2005, 05:09 PM

I know exactly how you feel. If you still have many questions, seek another attorney ... one that will spend as much time with you until your questions are answered.

We were in the same boat. The first attorney we visited stated we made too much money and didn't qualify for Chapter 7. I couldn't believe it especially when we were struggling to make ends meet even without making our credit card payments. Then after about 3 months, that attorney (turns out they were paralegals and we just assumed we had met with an actual attorney) called to tell us that we shouldn't even file Chapter 13 because our payments would need to be around $1400 a month for 5 years!! We didn't know where to turn. I called a credit counseling service and they told me I needed to pay them at least $1500 a month for 3 years. We couldn't afford either.

After a couple more months, we decided to visit a new attorney. We made sure we were actually talking with THE attorney and not his paralegals. He spent around 2 hours with us discussing both Chapter 7 and Chapter 13. He told us that we made good money but if we proved our expenses were valid we would qualify for Chapter 7. He thought it would be better to try for Chapter 7 and the worst case scenario would be that the Trustee would dismiss the case and we could convert it to Chapter 13.

We recently had our 341 meeting and everything went as planned, we're able to file Chapter 7 and we're expecting our discharge sometime in June. I can't begin to tell you how relieved we feel. I know we should feel "bad" because we filed bankruptcy but it sure is a great feeling knowing that I can start saving money again and get back on our feet financially.

Talk to another attorney or two. The visits are free, it's just your time you need to invest. You'll find the right one. It isn't always the biggest ad in the phone book that gives you the best results.

Good luck!

**Minnymouth** · 04-20-2005, 04:37 AM

Minnymouth here,
Just about all Chapter 7's are simple and quick. Everyone I know that has done a 7 it is over very quickly and settled.
My Chapter 7 was very unusual, I had an "unperfected title" on my mobile home and didn't know it. Trustee found it. The Bank had never had the title recorded in my name with their lien against it. They only showed a lien against the land, not the mobile home.
Thus I LOST MY HOME AND LAND BOTH. Was not able to reaffirm. Trustee took mobile home, Bank took land.
Mine was a very unusual case, very devasating to me. Total loss. Not a typical Chapter 7.
During your bankruptcy, ASK QUESTIONS, keep an eye on what your lawyer is doing for you. CHECK ALL DEEDS AND LIENS on your paperwork. My lawyer checked nothing and has done nothing for me, except file the paperwork with the court.
If you have a lawyer that evades your questions, get rid of him.
From you situation, Chapter 7 is probably the best way for you to go if you can. Will give you "breathing space" again and a "fresh start".
Hope it all goes well for you and yours.

"Life is like a bowl of grapes - some days are sweet, some are sour"!

Take it all in stride!

**The Big B???** · 04-25-2005, 10:35 AM

Attorney number 3...

Just got off the phone with attorney number 3 who I found via a link someone on here had posted to a site that gave a list of attorneys who had got through some sort of bankruptcy certification.

He spent about a half hour on the phone with me and I have an appointment set for a free consultation with him for Friday at 7AM. He was much more thorough with me than any of the other attorneys to date and did speak in terms of my case specifically and did not speak in generalities.

So now the crux of it...I'm scared again. We discussed my house and he told me that there are no guarantees that I will be able to keep my house. That the trustee may want to sell it being that even thought I just got it and there is relatively no equity, the area that it is located in is booming real estate wise. I know the area is as well, that's why we bought there.

Anyhow, I am going to be rounding up a ton of info that he requested I bring to the meeting Friday. I know already that he will not be a cheap $ attorney. But I did appreciate his frankness and understanding of the situation and further, his thorough questioning of my situation as opposed to the cookie cutter approach of the last attorney I spoke with.

My wife started chemo last week and life at home is now a horror show with the agony that she is going through. I simply cannot afford to roll the dice on our home. Is a chapter 13 the way to go instead of even thinking about a 7 at this point? We plan to sell the house in 3 years and move to Florida anyway. The house should be worth more than we bought it for at that time and it appears that for now anyway, you can get a lot more home for your money in Florida than you can here on Long Island.

Answers, feedback, insights, knowledge all enthusiastically accepted and appreciated here.

Thanks

**The Big B???** · 04-25-2005, 10:46 AM

Forgot to add that I was having an OK day today prior to that conversation. The moment I hung up the phone, that feeling ended. I'm now anxious and very nervous. On the verge of trembling. My mind is racing and I now feel like I have a million and one things to do at once. Add to this that I still have a few hours left here at work and a ton of stuff on my plate at home tonight.

Oh well as I always say when things get tough in life..."this is the adventure part"

**The Big B???** · 04-26-2005, 07:24 AM

Spitballing now...Thinking out loud, trying to come up with a way to go 7 if possible and not lose my house.

When my wife and I purchased the home on Feb. 28 of this year (NY state) my debt to income was too high for me to be on the mortgage. At the time I had no thoughts of doing a BK and decided to be on the deed with her even though I'm not on the mortgage. Fast forward to 60 days later and now we're dealing with her having breast cancer and me realizing that a BK is the only way for me to get out of the past debts that I have (75 k or so unsecured).

After speaking with the attorney on the phone yesterday, and hearing that the house is not safe in a 7 even though there probably is not a lot of equity in it, I'm wondering if it's possible for me to remove myself from the deed and wait a few months?? prior to going for a 7 on my own. Is that a possibility? would it raise a major flag and cause me to look like a fraud in the eyes of the trustee, law etc.? I'm not in this position due to shopping sprees and fun times. Are any of the true hardships that put me in this position taken into account? Or is it all just number crunching and one size fits all in the eyes of the trustee?

Further, now that she is in chemo, she has been cutting back hours at work. Therefore less income. I started working a second job at night last month. To date I've gotten 2 paychecks. The first was just for a night of training $30. The second was for 2 weeks of work $250 net. Should I quit this job prior to filing any kind of BK? If I don't, wont I be showing more income and essentially trapping myself into working 2 jobs especially if I go with a 13?

HELP

**Minnymouth** · 04-26-2005, 08:19 AM

Minymouth here,
FIRST OF ALL - CALM DOWN! CHILL OUT! Your going to be in worse shape then I was and right now your wife needs your strong, healthy, and supportive. She needs you to take charge of everything and get all the ducks in a row.
FIRST - keep your appt with your attorney, let him look at everything and listen to his advise. Got questions - ask!
Second job should offset some of the hours your wife had to "cut back" - be sure you ask lawyer about this. But really it would have been better not to take on the 2nd job. I was advised - NOT TO.
Hope you have good insurance right now - you don't want to end up with a bunch of medical bills you can't pay after bankruptcy ( had you thought of this). Hate to be discouraging but its a fact in your case.
You might want to consider a Chapter 13, then later go to a Chapter 7 if you have too.
Many things to look at in your case, be sure you cover all your bases with your lawyer.
But mainly, calm down, take each day as it comes, the phone calls will stop after you file, and hopefully things will go smoothly for you with no problems.
I wish you and your wife well, hope chemo is kind to her, and the outcome of it is great.
I've always heard there's a reason for everything - sometimes I question that - but usually find out its true.
Most of all - talk to your Maker - let him guide you, don't make a deal with the devil....
My thoughts will be with you and yours,

**Minnymouth** · 04-26-2005, 08:32 AM

While I'm thinking of it -
REMEMBER - the Trustee does not work for you, he works for the creditors and the court.
Your personal problems, health, reasons for claiming BK are of no interest to him - that's too personal. They don't ask, and don't want to know.
Trustee is interested in "what can be turned into cash" for his creditors.
If your house has no equity - no purpose in taking it to sell. But Trustee also has the power to "undo" contracts, etc during the past year. I don't know if the Trustee could force you to downsize regarding your home or not? This is something else you need to look at and talk to your lawyer about.
Good Luck

**mark** · 04-26-2005, 07:49 PM

BIG B,

Talk about your long row to hoe. You need to read and learn all you can about BK. I say forget about chapter 13 alltogether you will get zero relief for that, in fact it will probably make your situation worse. First thing to do is focus on your living expenses after BK. I would not count on getting any IRS money discharged in BK. They are pretty much untouchable in BK for the most part. I would add up all living expenses and if any income is left it will go to the IRS. Income vs expenses should not be an issue for you. Your house would normally be safe but I understand that some of the new laws concerning real estate purchased within a certian time preceeding the filing are in affect as of the day the ol pres signed. The trusstee may require you to find cheaper housing so you can pay back more of the taxes you owe. I would prepare to move just in case. You car should be ok, without it you have no income. You have exemption for your personal items i.e. clothes, furniture,electronics etc. Boats and motorcycles, jet skis and stuff like that will be taken for sure. So what! The amount of unsecured debt is not an issue. $100.00 or a $1,000,000.00 it just doesn't matter it will be wiped out. Give up the part time job and later you could resume that if you want to. You don't want to have to state more income than you would normally have in a 40 hour week. If you did not have the tax issues I would think you could go it Pro-Se with a good BK preparer. They cost about $200.00 but they cannot offer any legal advise. Educate your self with all the information you can. Check on your local laws, epecially concerning your personal property exemption limits. Stop paying any unsecured credit bills now. Do not try to transfer any assets at this point, you will be questioned about that. Anydebt that can be even supected as fraud is not dischargable. Taxes have to be atlease three years old to be dischargable. I don't think you will get any relief from your tax liabillities so use them to your advantage on you expenses matrix.

You are taking the right steps to solve your debt problems. Stay positive, and in charge. Don't let the blood sucking credit councelers or the fly by night BK lawyers get what little you have. If they since you are weak they will take full advantage of you and then feed you to the wolfs.

Spend all of your spare time on forums like this one. There are hundreds of them. All of us are dealing or have dealt with the same situation as you are and they really want to help you. And best of all most of us do not ask for money, but beware some of the bloodsuckers are hanging around so be carefull.

mark

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