top Ad Widget

Collapse

Announcement

Collapse
No announcement yet.

Lien Stripping, Community Property, A prior chapter 7 and a whole lotta debt!

Collapse
X
Collapse
 
  • Page of 1
  • Filter
  • Time
  • Show
Clear All
new posts
Previous template Next
    #1

    Lien Stripping, Community Property, A prior chapter 7 and a whole lotta debt!

    Hi,

    I posted this originally in the chapter 7 forum but have decided to post here as well.

    I spoke to three attorneys, two who seemed clueless and uncreative and another who spent over an hour on the phone with me and came up with some interesting ways to help our situation. Here is the original post:

    My wife and I live in WA state. Community property state. Here is where we are at:

    House in my name, purchased before we got married. It is not in foreclosure yet, but will be by the spring as we are walking away from it and living here as long as we can until we have to move.

    I have filed for a chapter 7 in the past in June of 2003 which was discharged in 10/2003.

    My wife has never filed. Ever.

    I am currently unemployed due to a layoff back in 3/09. She is currently employed full time.

    We have unsecured debts that break down this way:

    My name only: 40k
    Her name only: 30k
    Joint: 10k (both were hers to begin with but my name was put on after married)

    IRS tax owed by her: $4k
    Student loans owed by me: $55k

    First mortgage in my name only: $373k
    Second mortgage in my name only: 94k

    House value: $345k'ish


    I understand I cannot file for a chapter 7 and may not be able to file for a chapter 13 because of my employment status.

    I have read things online that indicated a possible discharge of our joint debts and/or my debts in addition to hers because we are in a community property state. I spoke to an attorney today and he seemed to think the creditors would not be charged off and that they would all actually come after me, at least the joint one's would.

    How would our house situation help or hurt her ability to file a chapter 7?

    Could any of my debts be included even though I can't file?

    What if we have her file just before we are about to let the house be auctioned off, and then we'll only be a year or so away from being able for me to file again? I know this is sounding extremely irresponsible, but the last few years have been a complete nightmare going from 175k a year in income, to 100k, to 72k to zero. I didn't buy this house with bad credit, poor loan terms and no financial ability to pay. Life just happened and now we are stuck.

    Her income is $42k a year.
    Filed 7/14/11....341 date is 8/23/11
    Tags: None
    #2
    The attorney is recommending a chapter 13 for both of us and that we actually want to be just above the median income for the means test but not too much that we have to pay all this unsecured debt off.

    He believes that we can possibly, not have to pay ANY of the unsecured debt, lien strip our second mortgage if we want to try and keep the house with the first mortgage alone, and possibly even cram down our upside down auto loan which payments have been made on time and we intend to keep the vehicle regardless.

    He also said that although the norm that is all over on the internet is that the payment plans are 36-60 months, that there is actual case law that is allowing some of these plans to be completed and discharged in 10 months. At which time I can then approach my current first mortgage lender for a loan mod (which i dont qualify for now) because all other debts and the second mortgage have been extinguished.

    Since we have not received a NOD yet on either mortgage and are not in a foreclosure status with them yet ( i just spoke to them two days ago ) and no one is sueing us at the moment, he advised us to stop paying our unsecured debt and start saving some cash and call him after the first of the year and to talk about a strategically placed filing date based on where we are with the mortgages and other stuff.

    We will continue to pay utilities, car payments and other stuff while saving some cash, but obviously not too much. He said just not to let it get over 20k.
    Filed 7/14/11....341 date is 8/23/11

    Comment

      #3
      Since your wife is working you could file a 13 together and include all of the debts you listed. Just because you don't have a job doesn't mean you can't file a 13. As long as there is household income you can. My wife does not work and we filed together. If your wife files a 7 without you only debts she is responsible for will be discharged. I don't live in a community property state so I am not sure what impact it would have on bk.
      Chapter 13 Filed (Pro Se) - 9/30/09
      Confirmation Date - 12/1/09
      Stats - $1752/month, 29/36 completed, 4% to Unsecured, Lien Stripped 2nd Mortgage

      Comment

        #4
        yes, that is exactly what the attorney said. Because we have so much debt and our mortgages are high for what we make in our household income, he said that we can effectively eliminate the unsecured debt because the payment plan based on our income wouldnt be able to have it included (of course he has to structure it properly to get it approved by the trustee) ........he seems very in tune with the case law and loopholes on how to do this........i am pretty excited, but i know i need to temper that excitement until we get into the nuts and bolts of it after the first of the year since nothing is concrete yet............

        i thought we were only going to be able to discharge her stuff but if we can do mine as well as the lien stripping, we have a chance to keep the house, get a roommate and pay the same as if we were renting with all of that factored in........that sure is a better way to rebuild your credit than the alternatives.......
        Filed 7/14/11....341 date is 8/23/11

        Comment

          #5
          anyone know what happens to back owed IRS taxes? It isnt for alot of money.......about $3800 or so and it was from 2 years ago on my wife's return (we were not married at the time)..........

          we think we'll get a refund in 2009, so should we just file and let that offset what she owes?
          Filed 7/14/11....341 date is 8/23/11

          Comment

            #6
            I am currently unemployed, but do have my real estate license. If i were to sell one property for a friend and make a commission on it, is that going to be considered something the trustee will take from me in a chapter 13?

            It isnt something that I normally would get for income and isnt my full time career.
            Filed 7/14/11....341 date is 8/23/11

            Comment

              #7
              I can't see having a plan for less than 36 months. The only way it would happen is if you are in a 100% payback.

              Don't be to dissapointed if you're in a 36 month. If you're above mean in income then you go to a 60 month plan.

              Comment

                #8
                Originally posted by biotechsolution View Post
                I can't see having a plan for less than 36 months. The only way it would happen is if you are in a 100% payback.

                Don't be to dissapointed if you're in a 36 month. If you're above mean in income then you go to a 60 month plan.

                I think (I have read) that if you have a negative disposable income number, and live the 9th Circuit Court jurisdiction (there was a ruling regarding this issue), you may have a chance at a minimal or no Chapter 13 repayment plan time requirement.

                Skipper

                Comment

                  #9
                  Skipper...........this is what the attorney I spoke to was talking about I believe.........he mentioned that there is case law and it has to do with the 9th circuit court that would somehow allow a 10 month repayment with full discharge at the end of it.......obviously i do not know the specifics, but this guy really seemed up to speed on case law and what is and is not allowed......he seemed very creative and willing to look "outside the box" of what the cookie cutter attorneys seem to advise
                  Filed 7/14/11....341 date is 8/23/11

                  Comment

                    #10
                    Originally posted by tjs1970 View Post
                    Skipper...........this is what the attorney I spoke to was talking about I believe.........he mentioned that there is case law and it has to do with the 9th circuit court that would somehow allow a 10 month repayment with full discharge at the end of it.......obviously i do not know the specifics, but this guy really seemed up to speed on case law and what is and is not allowed......he seemed very creative and willing to look "outside the box" of what the cookie cutter attorneys seem to advise

                    Is he in AZ? Looking for a good atty...

                    Comment

                      #11
                      I am in WA state. (so is he)
                      Filed 7/14/11....341 date is 8/23/11

                      Comment

                        #12
                        Originally posted by tjs1970 View Post
                        I am in WA state. (so is he)
                        Bummer...

                        Here is the case, if you want to find it...


                        Skipper

                        Comment

                          #13
                          this is some pretty boring stuff until you get about three fourths of the way through it and then it gets really good/juicy as to how this could work.......


                          http://www.metnews.com/sos.cgi?0608%2F0617083
                          Filed 7/14/11....341 date is 8/23/11

                          Comment

                          Previous template Next

                          bottom Ad Widget

                          Collapse
                          Working...
                          X