new and have questions

[confused2]

Hi. I 'm so glad I found this forum. I have a ton of questions so if anyone wants to address any of these I'd be so grateful:

1) I am negotiating a lawsuit against me which if I can't settle at a lower price makes me contemplate bankruptcy. One lawyer told me I should file now rather rather than after the judgment. Of course I'd rather wait to see if things will negotiate down. His point is things would be more difficult after the judgment. Does anyone have thoughts on this?

2) Can someone clarify more the phrase about malicious and intent? My suit involves a copyright infringment but none of the paperwork involved the word malicious or fraud. I would NOT want to declare bankruptcy and then find out this was not-dischargeable.. Is there a way to know in advance if something falls under that category for sure? How does that get determined (it involves federal court).

3) My credit cards and everything else is in good standing. I am wondering if I necessarily have to lose my credit cards and also if it's possible to get a home equity loan after bankruptcy from same company I already have one with which I make monthly payments on regularly with.

4) What are some things that can be done legitimately to get extra cash after bankrtuptcy if a home equity loan is not an option? Or what can one do beforehand? Thanks for any help. I have a lot more but will start here!

[StaciMM]

If you file BK, it will include ALL of your debts. That means the credit cards also. It would affect the credit cards, though sometimes $0 balance credit cards do survive the BK.

There are 2 types of BK: ch. 7 and ch. 13. The main determining factor is how much money is left over, when you take income and deduct for normal living expenses. If you have $100 or more remaining, you would generally NOT be a candidate for 7 but would perhaps be for a 13. If that is the case, you would make a payment monthly for 5 years that would repay a % of your debts.

Filing BK before getting a judgement helps you in that you would end up with one public record (BK) rather than 2 (BK and a judgement). Other than that, it wouldn't really make a difference.

[SinkingFast]

I'd suggest you get more than one legal opinion before you decide about BK.

I am curious tho,......... How can you file BK on something you don't know yet. You don't know the outcome of the lawsuit. If there will indeed be a judgement. How much the judgement will be.

If you don't know the outcome of the lawsuit yet, how can you file BK against a debt you do not yet have.

If you file BK, even if you don't list any of your CC's accounts, some of your Creditors may dump you.

We have a friend who had an accident and too many speeding tickets in a very short period of time. When he bought a new vehicle and called to add it, the insurance carrier pulled his driving record as part of a routine check. When the insurance carrier found the cluster of tickets and the accident, his insurance company cancelled his coverage.

Since then, one of his CC companies did a routine credit review, found out about the cancelled insurance, and the CC company closed his account. It's froze. He can continue to pay off the balance in monthly payments as usual, but he cannot charge any more.

He's also had an account with a store, a store line of credit, closed by the merchant as well. He went shopping, went to charge his purchase, and was told his line of credit was no longer available. The people at Customer Service checked on it for him and let him speak to the rep on the phone. Evidently, the Store had also done a routine review of his Credit, found his auto insurance carrier had dropped him and one of his CC's had closed his account with them. Those 2 adverse events that had recently occured in his Credit history had lead the store to cancel the line of credit they were extending to him.

It's been a domino effect for this guy. One thing has lead to another. And this was speeding tickets and an accident. Not BK.

[edwards2]

sinkingfast...what a nightmare for that guy and to think it started with a speeding ticket...that really is scary! I have heard about insurance companies checking your credit periodically. Ours has not...at least not yet. We have had State Farm for over 20 years and had 2 claims. Our insurance payments are very competitive and our agent has been great....looks like your credit history follows you everywhere.

confused2...I would wait and see what happens with the lawsuit before you decide. Do consult more than one lawyer. Consultations are free. However, I do agree with Staci about having a judgment and a BK...If you lose the judgement you might strongly consider BK. You certainly dont want both of them on your record.

[keepmine]

If you don't know the outcome of the lawsuit yet, how can you file BK against a debt you do not yet have.

The attorney will list it as a contingent/unliquidated liability. You ssee that a lot in Chapter 11 cases where there are a bunch of auto or equipment leases.

I'd speak with more than one attorney about the copyright issue and is that fraud? Just have no idea.

[SinkingFast]

sinkingfast...what a nightmare for that guy and to think it started with a speeding ticket...that really is scary! I have heard about insurance companies checking your credit periodically. Ours has not...at least not yet. We have had State Farm for over 20 years and had 2 claims. Our insurance payments are very competitive and our agent has been great....looks like your credit history follows you everywhere.

All the attnys were telling us to get a copy of our Credit Reports so we pulled ours about a month ago. Seems our auto insurance carrier just did a credit check on us the beginning of February.

We still looked good then. Missed January payments weren't showing on our Credit Reports yet. Thank Goodness. So every account showed "Pays as Agreed". Phew! Another week or 2, and the reports woulda looked totally different.

[confused2]

continuing

Thanks everyone for your ideas. I am seeing both a coppyright atty and bankruptcy one this week to discuss the lawsuit, but on the phone the bankruptcy atty said it is better before getting a judgment as there may be a way the company could block the charge...

I hope it's okay to ask a few more questions..

1)In terms of preparing beforehand to set aside money, how do people do that (ie do small withdrawals from each acct and hide in dresser??). Since my income isn't high but I have some savings now I want to figure out best way to do this since if I declare bankruptcy and I am in ch 13 rest of my monthly extra will go to the debt.

2)I have also been paying car payments for 3 years. What is best way to deal with keeping car (if possible).

3)Would buying business equipment and home repairs be okay in advance and how far ahead of time? Thanks.

[confused2]

Oops one more

Oops Okay I do have one more question for the pros:

Say I am in chapter 13 and have a monthly payment for the debt.. if I also wanted to somehow have some extra money to visit relatives a few times a year that is beyond my income situation, could money be taken out of one's retirement or buy getting a home equity loan or would that then increase what is paid out to the creditor? Basically what I"m trying to figure out is what you can do for a few extras a year if you needed money but don't want it to be applied to the debt payment!

Also what books are good to read about maximize your cash before bankrutpcy?

[keepmine]

You will be ale to reaffirm your auto loan. Also, what sort of equity {if any} do you have in the car and how does that compare with what your state allows as an exemption.
Use your savings to make home repairs and buy supplies for your business. Don't buy any expensive equipment unless your lawyer says it's OK.
Don't hide money. It's OK to spend it on things necessary to maintain your standard of living. make repairs to a home or auto. Medical expenses, etc.
Don't make any big moves until you see an attorney.