Chapter 7 Diary

[Vandervecken]

No, he's just trying to determine if the rental house equity is worth pursuing.

[lightning65]

Hi, just wanted to join in. I am also going through a Chapter 7. After my creditor meeting, Nov 2016, I have received "request" from the Trustee for more bank records. I have also been notified recently notified that they will be taken my tax refund, just a heads up. My Confirmation hearing is later this month. It's been a very rough going, not easy at all. My best to you.
Michigan

[justbroke]

Hi, just wanted to join in. I am also going through a Chapter 7. After my creditor meeting, Nov 2016, I have received "request" from the Trustee for more bank records. I have also been notified recently notified that they will be taken my tax refund, just a heads up. My Confirmation hearing is later this month. It's been a very rough going, not easy at all. My best to you.
Michigan

Are you sure you're in a Chapter 7, or are you in a Chapter 13? You are using "confirmation hearing" which doesn't exist in a Chapter 7.

[lightning65]

My bad, I'm in a chapter 13. Good catch.

[Vandervecken]

Update:

Tomorrow is the second continuance of the 341 meeting. Today at 5 PM, the trustee filed two new documents:

First is an application by the trustee to hire himself as attorney. I'm pretty sure this is because he has decided this is an asset case. I knew this was a strong possibility, and I can cash out an IRA to redeem the equity in my rental house.

Second is a motion for by the trustee to extend the deadline for objecting to discharge. I assume this is also routine, that he's decided this is an asset case.

Problem is with my employment and clearances. My company is selling my unit off to another company, and looking for any excuse to reduce headcount. Any delay in the discharge will push me into the selloff time frame. So now I'm worried.

[justbroke]

I don't know why you're going to use a retirement account to save property. Second, why are you worried about a discharge? Your company doesn't even know, and a company can not fire you solely for the reason that you filed or are in a bankruptcy.

[Vandervecken]

Good evening, JB!

As far as the house, it's "more" than a normal investment property. It's next door to my own house. My mother is becoming frail in her old age and I bought the house several years ago to be hers when she needed to move in next door. In addition, my ex-wife's name is still on the mortgage, and the divorce agreement explicitly states I cannot surrender it in bankruptcy. Fortunately, it's a profitable house, and even paying a few thousand to redeem it will be worth it.

As far as my employer... well... sure, they cannot fire me for being in bankruptcy. Just like it's illegal to target older (higher paid) employees for layoffs. But my company can "arrange" for me not to be assigned to projects, resulting in few/no billable hours. And that would result in being laid off. Plenty of ways to skirt the law and an uphill burden of proof for me. They would "know" because the case would be open when the company spins off and our background checks are redone.

[justbroke]

I can tell you that I have personally had zero impact from employment background checks and federal government and law enforcement background checks.

An unscrupulous employer seems to always find a way to get rid of someone. I would hope that I never work for one but then, again, I may be working for one and do not know. Oblivious.

My post was only meant to be thought provoking and to make sure that you have planned for your personal retirement. It reads as though you may be at that age where high-tech employers like to find "some" reason to let go of their senior staff (typically over 50 and making $$$). I was only being reflective of how I spent my entire retirement savings (significant $$$$) trying to save property. You appear to have a noble reason to save the property.

As for the discharge versus closing, it looks like your case will take some time to close. The Trustee is interested in one or more assets and that can take some time to liquidate the estate and process claims. I assume that the Trustee has also sent notice to the creditors indicating that there will be a distribution and established a bar date to file claims?

[Vandervecken]

Your posts are always thought provoking and educational! You're right, I have a special reason to save this house, and the equity isn't "that" much. And you're right, I'm an old fart (low 50s) in a technology career.

As far as the assets, there is only a single asset not exempted, the rental house. It should be straightforward, but I don't know what the trustee's schedule looks like. Maybe he's simply buried in paperwork and cases. So far the only documents filed were the request to hire himself as an attorney (which was approved today) and the motion to extend objections to discharge, which has been given a court date in six weeks. The case still has the 341 meeting open.

And if i think of turning lemons into lemonade: of my unsecured debt, over half of it is student loans that cannot be discharged. So of any money I pay in to redeem my equity, half of it will go to student loans I have to pay anyway. I can live with that (lol).

[Vandervecken]

Follow-up:

Traded emails with my lawyer today; she told me to just be patient, there's nothing to worry about. In our district a three month extension request is normal; with just a single asset the trustee may be done before the motion to extend actually goes in front of the judge.

It's hard to be patient.

[Vandervecken]

Update:

Over the weekend, the trustee changed my case to "Asset" and mailed out the notifications for creditors to file a claim. Deadline is 5/15. Now I must wait to find out how much equity the trustee thinks I have, and for my attorney to negotiate with him.

On a personal note, I suspect my ex-wife (the reason I filed) is going bat-crap crazy with all the legal mailings she's getting on this case. I am following the divorce settlement to the letter of the law, and there's nothing she can do about it. Every joint debt I have from the divorce settlement has been reaffirmed (and to be honest, at surprisingly good terms.) But I can imagine she's nervous as hell, maybe even racking up legal fees to review the paperwork. (Please note my lack of sympathy at the thought of my ex-wife having to pay legal fees out of her own pocket.)