Issues with cc purchases before filing?

[UNDERMICH]

STEP 4

Change your exemptions so you do not get a big return when tax time rolls around. The odds are when in BK13 the trustee will take them. You can not change them during the 3 or 5 year term.

[debtinohio]

Well said kornellred.

[flyinbroke]

I had to change exemptions so that I get less back per payday and owe less at the end of the year. Now I have to wait a few months for my average take home to decrease. Grrr.

[debtinohio]

I had to change exemptions so that I get less back per payday and owe less at the end of the year. Now I have to wait a few months for my average take home to decrease. Grrr.

I waited a few too for that reason, sucks.

[flyinbroke]

Well, it is a calculated risk at my end. I checked our civil court for debt hearings. Of the three banks I am delinquent with, only BoA has sued in civil court since I quit paying and they have only sued a couple of business entities. Was cosidering dropping my 20 minimum to Chase but they (and AMEX) are the ones with the most suits....Chase filed about 75 percent of the suits in civil court against both individuals and businesses. I want to drag as long as I can for now.

[debtinohio]

I was sued only by a local credit union for around $5000. I had all the big ones, Chase, AMEX, BOA, Discover, etc.

[flyinbroke]

I stopped paying on 2 BoA, a Citi, a GE and a Sam's Club Discover (which is under GE.) Only received three "We have not received a payment and we are worried and we can help" letters and nothing more. I get a lot of blocked calls, which is illegal in TX but it doesn't stop them. I may have to turn on the ringer, find out who is doing it now, and turn up some courtroom heat on them. They can use my winnings to pay off my accounts lol.

Just stopping those minimums freed up 1300 a month in cash. I like that.

[debtinohio]

I stopped paying on 2 BoA, a Citi, a GE and a Sam's Club Discover (which is under GE.) Only received three "We have not received a payment and we are worried and we can help" letters and nothing more. I get a lot of blocked calls, which is illegal in TX but it doesn't stop them. I may have to turn on the ringer, find out who is doing it now, and turn up some courtroom heat on them. They can use my winnings to pay off my accounts lol.

Just stopping those minimums freed up 1300 a month in cash. I like that.

Being in TX you should lookup a guy by the name of codename47 on the fatwallet.com finance forums. He is a "credit terrorist" who sues collectors for rights violations in that state.

[flyinbroke]

Saw him on there, and on another site his name comes up...he is the guy who tapes these CAs messing up then lobs suits their way. If I recall correctly, he has made somewhere around 25K doing this too.

Codename47 is gone from fatwallet; according to a post sometime in January, he was chased off by a few mean-spirited FW members and hangs there no more.

[rcoveles]

No. If you qualify as more than 50% non-consumer debt your disposable income no longer matters. You could make 40 million dollars a week.
When they wrote the new laws they didn't want people afraid to try new businesses, since that is what make the economy go around.

My attorney was going put me in chapter 7 with the means test showing $2000/mo disposable income. I had some special circumstances and ended up going with a 13 anyway to lower the chance of Adversary Proceedings.

What are Adversary Proceedings? Should I be worried about that?

This has been driving me absolutely nuts, but armed with this new information, I've actually started to think that if CH7 is available to me, I should definitely do it. I bought the Nolo CH13 book, and they even say that. I wanted so badly to continue my business, but as someone pointed out to me today, falling in love with your business can be the worst thing possible - you lose objectivity, like - why am I in this trouble to begin with? Because business sucks!

I really thought 13 was the answer, but as I read more and more about it, I'm certain it won't work for me for so many reasons. I also had to face up to the fact that my business is doing about half of what it was 2 years ago. What will it be doing 2 years from now, when I'm only 40% through Chapter 13?

Not to mention, I live in PA, so pretty much everything my wife and I own jointly, including our house, is exempt. The only non-exempt items I really have are some guitars and amps that I use to play on weekends, and my business inventory, which - and I'm not banking on this - could very well be abandoned by a trustee. If he thinks he can move a bunch of novelty t-shirts and stickers and things of that nature, then more power to him. Most of my guitars are cheapies, or very beat up..or both. If necessary, I'd probably try to work out a payment plan to keep those so i could continue working - the only tools of the trade exemption PA has is for a sewing machine..1941 called..they want their bankruptcy laws back..

Anyway, I'm thinking now might be a good time for a fire sale, and to start reading through some stuff on the Chapter 7 board

[forgotten]

What are Adversary Proceedings? Should I be worried about that?

It is where a creditor objects to the dischargeability of a debt due to fraud (making luxury charges before filing, charging when you knew were insolvent, lying on your application, etc.). I really pushed that envolope getting as much credit as I could for my business, just wanted to keep that burried.

It sounds like you have an excellent new plan. That is the course I would take.

Entering a CH13 to try and save a business can be difficult. My wife had to close her business and get a job for "the man" so we could make it through the 13, its hard to keep your business income consistant enough to make a CH13 plan work.

[rcoveles]

It is where a creditor objects to the dischargeability of a debt due to fraud (making luxury charges before filing, charging when you knew were insolvent, lying on your application, etc.). I really pushed that envolope getting as much credit as I could for my business, just wanted to keep that burried.

It sounds like you have an excellent new plan. That is the course I would take.

Entering a CH13 to try and save a business can be difficult. My wife had to close her business and get a job for "the man" so we could make it through the 13, its hard to keep your business income consistant enough to make a CH13 plan work.

Well..I guess I sort of did that too to an extent. Last year, as a last gasp, I used some cash advance checks for like 20k, and also exhausted my line of credit for another 25k. I didn't do anything out of the ordinary..was just trying to stay afloat. It absolutely NEVER entered my mind that I would ever go out of business. Always thought I could turn it around. The LOC dried up in January after dinging it over the past 2 years, and the advances were taken like last February (09). Hopefully, they won't cause any problems. I never charged any luxury items..just paid for inventory and necessary business expenses.

A lot of things about the 13 bothered me, and I suppose I originally was just trying to avoid "the man" since I haven't worked for him in about 10 years. It sucks. But I'd rather work for the man and call all of the shots in my personal finances, rather than worry about not saving for retirement, or being unable to feed my cats because they are not "necessary". My friend was told by her trustee that her husband had to stop his 401k contribution and give it to the plan. My wife gets an employer match, which he considers her raise, so that's bullcrap to have to surrender that.

In the end, I realized I would probably just wind up in a 7 at some point, so why even waste my time and money making 13 payments when I never had to.