Can we wait 'til creditors sue and then file?

[holycowe]

We'll file 13 soon but wanna wait few more months to sort things out (cars, incomes...).
What happen if they sue before we file? Can we just file right after they sue us? Is it gonna be the pain if they sue before we file?
We will file for sure but really need few more months. What is the best way to buy time? One of them (Discover) has transfered to a local CA
We've stopped paying some CC almost 2 years ago including (discover, chase, citybank..) and so far none of them sue us yet but I have a feeling they will soon. Also gave up the house 3 years ago (with 2nd).
Thank you everyone on this board. Been reading everyday for a few weeks and have learn a lot.

[AngelinaCat]

Yes, you can wait until someone sues you. We had two suits filed against us, and filed after that. We had been waiting to file for some time, most of it because we were waiting on our worthless attorney to get off her duff and DO something. The two suits were the final straw, and we went to her office and INSISTED very strongly that she file our petition.

In the meantime, use this time wisely and get your ducks in a row and educate yourselves. Good luck!

[holycowe]

THANK YOU!!! And yes, that's what we doing.
Too many get sue lately after just a few months. We are at least a year and half already, and the 2nd is well over 2 years.

[sunshinepa]

Wow holycowe..........Citibank sued me in less than six months.......you sure are lucky. I have to file fast now....LOL. only six days left to answer summons. Talk about stressful. I should hae filed when they turned it over to the collection lawyer and but wanted as much time as possible between cash advances and bal. tranfers. Both have been over a year now so hope all goes well. Waiting to see the CMA on my house to determine ch 13 or 7.......praying for a 7 as under medium and can easily do.

Good luck and I hope they continue to let you alone....watch Citibank......they get nasty quick.

[lillymarlene]

Yes you can wait until being sued. I finally had 2 lawsuits pending against me, and this really motivated me to hurry up and file. When creditors are threatening liens against your property, it seems pretty serious :-)

[holycowe]

Discover account that ended up at local CA with balance $10k
Citybank account orig. $34k now ended up over $40k (they added up interest I guess)

[catleg]

I was like the proverbial cowboy with 10 arrows sticking out of his back.
My wife and I got sued 10 times, 3 went to judgment.
When one filed for a wage garnishment we filed BK papers.
The only problem with this approach is that it messes up your credit history real bad.
It's much easier to get back "in the credit lifestyle" if you BK fast with few or no 30 day lates.
But I don't care, I don't want anymore credit anyway. I'm off that hamster wheel.

[kornellred]

There is simply no way to predict if a creditor will sue you, or when, if they do. The larger the amount you owe, the greater are the chances of a lawsuit. Sometimes, surprisingly, creditors to whom you owe $1,000 or less will actually sue you. Again - you can never be sure.
There are certain things of which you can be sure when it comes to lawsuits. Due process must be implemented, which means that the debtor must be notified of a creditor's intention to sue. You will know a least a month or more in advance of the hearing date. Then you must decide if you should even bother to go to the hearing. If it is concerning an unsecured debt which you are certain you owe, there is no point in showing up. The creditor will obtain a default judgment, which is no different than a regular judgment. Once the judgment is in effect, you will, in some districts, be required to appear in court for an asset examination. If this is not required, the creditor will advise you of the judgment and give you a chance to make payment arrangements before they take any other actions such as putting levies on your bank accounts or obtaining a writ of garnishment. You will never be advised about forthcoming bank account levies (for obvious reasons) and you can assume that garnishment of wages, if allowed, will happen. There would be no point in obtaining the judgment otherwise. So....if you are advised of a hearing date, and the creditors already know where you work and bank, you have a minimum of 3 months or so before the creditor starts taking money away from you against your will.
If you receive a notice to appear in civil court on charges of indebtedness, do not leave large sums of money in your bank account. Stop direct deposits of paychecks into your account. It's a pain in the you-know-what, but less painful than trying to unfreeze the levied bank account after you have filed for bankruptcy. Your bank will charge you a hefty fee for the levy even if there is no money in your account to seize, by the way.
The automatic stay will stop wage garnishment that is already in effect, but timing issues will allow the creditor to keep any money obtained via garnishment prior to the bankruptcy court notifying the creditor of the stay.
Aside from property and valuable asset issues, that's as bad as it gets when it comes to money judgments.

Bankruptcy stops judgment execution dead in it's tracks, but you must be mindful of timing issues.

[lillymarlene]

In my area they seem to have a "pre-trial" phase first. Last March, I received a summons from one of my creditors. I decided to go to this "circus" to prevent them from getting an instant default judgement. I knew I'd definitely lose if it came to a "real" trial. However, I just wanted to delay things as long as possible, until I could file bk.

[catleg]

Actually, regarding kornellred's excellent post, if you file BK, and wages and bank accounts garnished within 90 days before the BK filing by an unsecured creditor can potentially become property of the BK estate (should the trustee pursue it as a preferential payment), and could potentially be returned to the debtor if sufficient exemption amount exists that is not otherwise protecting other assets of the debtor.
At least in theory....