just accepted I must file soon

[dunno]

hello, all.

Background:

Used to make $150K plus, plus hubby made aprx $40K

Got fired Mar 07, after 14 years (FL, right to work state, boss didn't like me and me knowing his past)(I was GOOD at my job, but - hell - it happens)

Decided to sell Tampa home, make a new start( had to do with marriage almost falling apart 3 years earlier, move/sell and restart together was already in the works)

Had about $20K in CC debt at the time, THOUGHT I had about $60K equity in the home.

Used 4months to "do it myself" prepare house for sale.

Used 401K early dispursement and CC and hubby income to allow me to stay home and ready for sale and keep afloat.

Listed house in August for $358 - what I THOUGHT was about $20K under valued for quick sale.

Didn't go back to work, as house sale should be quick and easy, and we're moving.....

Around T'giving, the reality begins to set in... it's not selling. Lowered the price, started looking for work.

CC debt now at about 40K, having used it to help with cost of living.

December: no sale yet, Tampa market is tanking, despite the high desirabibly of the house, the foreclosures are far more attractive.

Decide I must lower the price and move to new locale to begin the 'restart'.

KNEW that I COULD NOT make less than $80K (based on the average incomes of my salesmen in a small-ish BMW dealership), so got hired as a salesman in Utah and moved ahead of hubby.

Used CC to augment income rather sparingly throughout.

CC debt now at about $45K. got about $5K left for emergencies. Still feel that we can earn enough to pay it off with the entry into "short sale" territory with mortgage.

Cashed in the last of my 401K for the move/paying debts. Moved Jan 1.

Market tanks. Gas prices surge. All the previous BMW customers in Utah have salesmen.I have to live off about 1/3 of the normal "new" customer traffic (AKA: my income expectations/actual is about 1/3 of what I'd counted on.)

Can't stand the work environment, move to Acura. (A more "practical" luxury car, in the consumer's eyes.)

My kids decide they can't stand living in FL w/o Mom and Dad, they move to Utah, asking that we put them up for a month or so while they find jobs, etc.

Last month - hit the financial WALL. finally couldn't pay ALL the creditors.

Now $52K credit card debt, $16K medical, $125 in back of mortgages, $6500 in 2005 tax laon, upside down in BWM lease and Dodge work van about $3000 each and own a 2000 Mazda (son's car, which he needs for work (see above) free and clear for about $2-2500) (owe $325K, offer on short sale at $200K). We make gross at about $75K.

Apparently, we are currently above the median income, but have no insurance and my hubby is diabetic.

I am scared to death.

I have an appointment with a BK atty Oct 13.

I am so scared that the use of my CC to stay afloat, the fact that I kept my son's car in my name to save insurance cost for him, and that I depleted my 401K staying afloat are gonna screw us in court.

I'd really prefer to C7, but will consent to ANYTHING to start over.

I am mortified at where my decisions have gotten us.

Advice, help, pats on the back, are welcome....

Dunno

[parsoc48]

Dunno,
I don't have any practical advice but just wanted to welcome you to the Forum, other more knowledgeable people wll be chiming in soon. It seems hopeless, doesn't it?! I'm so sorry...but you're taking the first step (seeing BK attny). Let us know what happens, and good luck

[bkrelief22]

Dunno...welcome to the forum. This is a great place for support! Best advice, read all you can and educate yourself about the processes. Believe me you're not alone...we've all had to make the decisions that got us here. But we're taking steps to remedy the situation. Best of luck, and hand in there!!! You will learn from those more experienced than me...I'm a newbie too who will file the end of this month.

bk22

[keepmine]

Cashing out 401K's and using cards to stay afloat are stories played out in bk court thousands of times a day. Nothing in your story is illegal or unethical and will have no bearing on your bk.

[JRScott]

Okay welcome to the forums .

Your situation is pretty common for folks that come here, lots of folks raid 401ks and run up credit card debts to try to stay afloat, so that's not a real big issue.

Now one problem you'll have is the fact you have not lived in Utah for 2 years from what I understand here, which means you have to use FL exemptions. Neither FL nor UT have really high vehicle exemptions though. This wouldn't affect your own vehicles but your sons it might.

Whatever you do do not change the car to your sons name now. This would be an insider trade and the Trustee would undo it. How much is his car worth?

At this point I would definitely stop paying on the CCs. Save up some of that money to pay the lawyer when you are ready. Don't stop at seeing just one lawyer, see 3-4 to help get a better handle on the situation. Also do not use the CCs anymore. Many lawyers like for no charges for at least 90 days prior to filing but you can retain them sooner and emergencies they'll do it but might charge more.

Even if you are above median income you might still pass the rest of the means test for a Chapter 7. With your husband being diabetic that probably means slightly higher than average medical expenses which can help in the means test.

I'm not sure if it would be better to delay and use the UT exemptions or use the FL exemptions, that would be a question to ask the lawyer on the 13th.

You'll have more questions as time goes by. Here is a little list of things to gather that you'll need:

Bank Statements for the last 6 months for each account (at least the last couple)
Pay Stubs for both of you for the last 6 months (you can usually get these from HR if you didn't keep them)
Medical Receipts for the last 6 months (since you mentioned he's diabetic)
Copy of both mortgages (in UT and FL)
Recent appraisal for both properties (as recent as you can get)
Copy of BMW lease
Copy of Dodge Van loan
NADA car values for the BMW, Dodge Van and the Mazda (You can go to NADA.com to get)
Copies of the last months Credit Card bills (at least the last month possibly longer)
Tax Returns (for the last 3 years, you can contact the IRS for copies if you don't have them)
Copy of the 2005 Tax Loan (note this may not be dischargeable and is something you need to ask the lawyer about)

Also useful are budget amounts for the following:

Food
Gas and Car Maintenance
Personal Hygiene
Insurance
Taxes
Tithing (if you make charitable contributions)

Also if your kids are still living with you they count probably as part of your household which might could help you get under the median income .

I'm sure you'll think of more questions, Good Luck !

[2Bshinyandnew]

Hi dunno,

Lots of similarities in our financial situations. One thing I noticed about your situation that was almost the same...For my daughter's 18th birthday, around May 08, my parents bought her a car, a combo graduation/birthday/you-better-register-at-the-local-community-college-or-lose-the car deal (we do what we have to to keep 'em in school). What a kick in the ass it was to learn that since it is in my name, it is an ASSET, regardless of who bought it, and what the purpose of the car was. The money that was used to buy the car wasn't even mine! I had not considered BK then at that point, what did I know? The car stayed in my name, both to save on insurance and if she decided to "go it alone" and not go to school, the car wasn't hers. She balked a whole lot, but when she priced out the insurance to go-it-alone, she simmered down.

Having the car in my name with her listed as a driver on my two car policy cost well over $3000/year less than if the car was put in her name and she was to insure it on her own. The savings in insurance to keep it in my name, even with filing a BK7 is well worth it.

The car, a used 04 Elantra is worth about $6-$7K now. When I file BK7 in January, it will likely be worth less. So, we saved $3k+ in insurance, but will have to buy it back from the trustee for, I'm figuring $5k, she's already banged it up quite a bit. It will be a wash, or pretty close as far as how much $$ has gone into the car by keeping it in my name. So the savings on the insurance balanced out what it will cost to redeem the car.

On the upside, the last major oopsie scratch she did on the rear quarter panel, yet another $600-$700 repair, didn't even make me flinch. As long as it is driveable and safe, I figure it will only reduce it's ultimate redemption cost. Boy did she ever look at me weird when I didn't freak over it! She doesn't know that her car will be purchased twice.

Hang in there!

[dunno]

thank you thank you thank you!!!!

helps relieve some of the anxiety...

I've noticed that perhaps what I need to do is look at what we ACTUALLY spent on food, entertainment, misc, etc, rather than "what we could live on" vis a vis a BUDGET -- AKA: what's gotten us into this bind, and perhaps put together a time line explaining what we did, when we did it and why?

Mainly, cuz after living pretty well fr some years, we did not immediately adjust our living habits (food expenses, primarily) until recently. Of course, that also had to do with our (now very clearly) unrealistic expectations that income would drastically improve.

Believe it or not, part of my hubby's diabetes regimen includes some avid cycling (30-50 miles 5+ times a week) to keep his blood glucose levels in check. Do you think they will allow us the costs of keeping him on the road? (mainly inner tubes and appropriate clothing for all weather and repairs to the bikes)

The kids are both adults and work now, although the first month of their arrival spiked my household costs (July and August), until they found jobs.

CRAP! I had no idea the 2 years in one state thing was going to be an issue! I can't see us waiting 1 year and 3 months to file. Will I be able to file in Utah with Florida exemptions?

>>>> see 3-4 different lawyers? Wow. It's like pulling teeth as it is just to get in front of ONE! (two week wait for consultation) But I guess that makes sense. I am just so EAGER to get filed and get it on the way!

I am learning alot reading here and am inspired by the stories of some. I am eternally grateful for you all sharing your learning and experiences to help us other fledgling filers!

Many Thanks Again!!!

Dunno

[JRScott]

Yes you can file in UT and use the FL exemptions if you don't meet the 2 year rule for UT exemptions. You've lived in UT for 6 months so you should be able to file.

The reason to see many lawyers is that some folks have not had good experiences with some. It's like shopping for a doctor or dentist, you want the right fit for your family. This is someone in a chapter 7 you'll be dealing with up to 6 months, and if ultimately its a chapter 13 for up to 5 years. So its important to have a good feeling, you may take the first one after seeing a few. They are being overrun right now and many lawyers are very busy.

Might put bike maintenance under car repair ....also if it is a medical order I could see it as a reasonable medical expense . (You're lawyer will probably be able to tell you which he can put it in).

It is important to make a budget for the here and now based on your income. They will not ask you how you got here beyond asking if any of it is gambling debt (which has a special place on it ).

There is of course a clothing allowance as well .

[Flamingo]

thank you thank you thank you!!!!

helps relieve some of the anxiety...

I've noticed that perhaps what I need to do is look at what we ACTUALLY spent on food, entertainment, misc, etc, rather than "what we could live on" vis a vis a BUDGET -- AKA: what's gotten us into this bind, and perhaps put together a time line explaining what we did, when we did it and why?

Mainly, cuz after living pretty well fr some years, we did not immediately adjust our living habits (food expenses, primarily) until recently. Of course, that also had to do with our (now very clearly) unrealistic expectations that income would drastically improve.

Believe it or not, part of my hubby's diabetes regimen includes some avid cycling (30-50 miles 5+ times a week) to keep his blood glucose levels in check. Do you think they will allow us the costs of keeping him on the road? (mainly inner tubes and appropriate clothing for all weather and repairs to the bikes)

The kids are both adults and work now, although the first month of their arrival spiked my household costs (July and August), until they found jobs.

CRAP! I had no idea the 2 years in one state thing was going to be an issue! I can't see us waiting 1 year and 3 months to file. Will I be able to file in Utah with Florida exemptions?

>>>> see 3-4 different lawyers? Wow. It's like pulling teeth as it is just to get in front of ONE! (two week wait for consultation) But I guess that makes sense. I am just so EAGER to get filed and get it on the way!

I am learning alot reading here and am inspired by the stories of some. I am eternally grateful for you all sharing your learning and experiences to help us other fledgling filers!

Many Thanks Again!!!

Dunno

The more one makes, the more one spends. You don't realize what is going on cause you have so much money coming in to pay high bills that when something happens like a medical emergency or a job loss, it all comes tumbling down. Then you start using the savings and credit cards to survive...then the 401(k) starts to go (most folks at that time do not realize a 401(k) is exempt in a BK filing and if you look into filing early instead of staying afloat, can save those funds). And you keep looking for another job that paid close to what you were making at the former job. Believe me, you are not alone - sounds like our situation and many others in this forum. We did not have the move situation but the job loss situation and "floated" for a year on savings, credit cards and my hubby's 401(k) (had bad advice at that time - 2001/2002). We too hit the wall when we realized we just could not rob Peter any more to pay Paul and we just could not keep it up anymore since there was no job in site even paying close to what my husband lost. In fact, as a result of his job loss in early 2001 (tech bust), he totally had to change his career but was too old to really go back to school (early 50's at the time) and after odd low paying jobs to survive he finally became a salesman in what he loves - photography. But he still is making 1/4 of what he made when he lost his job in early 2001.

A previous poster gave you excellent advice on the items you will need to investigate filing. Once you investigate that, you will find out exactly where you stand, what you can and cannot do, and will feel better. Learn from all this...you saw how things spiraled up because of bad decisions and out of control spending, although a lot is economy related for you. Realize all that could happen again if you don't learn to change your lifestyle after all this over.

Best of luck to you...

[skatermom]

I believe once you no longer live in the state of Florida you can no longer use their exemptions.....

[PoorGrammyinBK7]

Can they use the federal exemptions?

[dunno]

One of the things I thought would be a godSend was that should we come to this, Ut is like one of the BK capitals of the USA and perhaps it'd just be simple and easy for ANY BK atty to walk me through it.

At least, I sure hope so.

I am hoping to get good advice and gudiance on how to minimized the impact of this decision.

Can you believe I am worried about the most bizzare things: we have a modest flat screen TV that hubby bought 3-4 years ago when we decided we were not going to break up - will I have to sell it?

we own a laptop and a desktop computer. Me - I'd argue no house can be without one and the laptop I use at work cuz I use Excell spreadsheets I've put together to show my customers certain closing tools (work computers do not have MSsuites) AND it has a more attractive and professional email for professional contact with my customers. I also keep up with the news and product changes and trade values with it. My customer base is technically oriented (Acura) and about 90% consult with the interent before making buying decisions.

We use the XBox360 purchased 3 years ago in lieu of a CD player and to play whatever games we may own. Is that a loss, too?

At the risk of sounding/being out of line, what if those things belong to my children instead of me? I mean, could I be holding them for them as they move?

Also, when my son moved to UT, I opened a CU account in both our names so he could use the CU. He has been paying me back for the help in the move (as well as back car insurance and his cell phone) HOW do I cover/explain THAT???? Do I need to close the account and now he open his own, alone?

I don't want to throw any red flags here, but just cuz I used to have money and have kept things nice, do I HAVE TO sell them? Do I get in trouble for giving them to my kids prior to filing? I mean, they have nothing, other than their clothes and car (even my son doesn't have that, cuz his car is in my name!)

I'm afraid I will probably boor you all to death with all the questions I have, but I will do my best to also post what I learn and how things go for me as this goes on for the benefit of others!!!

[WorkingItOut]

Dunno,
I'm not an expert, but I do know that your computer and tv and other items will be ok IF they fall under your state's exemptions. You need to figure out which state's exemptions to use and see exactly what it covers. Most have a dollar figure amount for household items, and some states also have a wildcard exemption. The current value of your TV and computer will be significantly less than what you paid for them, so that's what you are trying to exempt. Good luck!

[JRScott]

Okay many of the things you are concerned about are going to be almost non issues.

The value of an item for yours schedules is what you could get for the item in a yard sale or garage sale at this time.

3 year old Xbox 360 worth what maybe 50 dollars in a garage sale if you included some games. A computer the same age is worth about the same.

A good way to get some prices would be to pick up a second hand flyer, we have those here not sure about out there. Basically folks list stuff that they are trying to get rid of. Another idea is if any garage sales or yard sales in your area go by and see if someone has similar stuff for sale and what they expect to get for it

[biggomez777]

In response to the slightly higher than average medical...if you have paperwork, you can claim it. Me and DW(ages 24 and 25) spend ~$800/month on medical for the 7 months prior to BK, and we had NO issues because we had bills to back every cent of it.

Amazing what medical can cost. Just got some pamphlet in the mail from my work that was supposed to help me choose my insurance for the next year...$70K for two years. Jeez.