Chapter 7 Gambling (New To Forum)

[sylvester30]

1

[lrprn]

Welcome to BK Forum, sylvester30 - glad you found us!

I was wondering if anyone could share their thoughts or advice given my current situation? Most of the credit card companies were willing to settle but we couldn't borrow enough money from friends/family to do so. Also, the attorney advised us not to settle as these funds could be recollected by the trustee. If this is converted to a Chapter 13 bankruptcy, I won't be earning an income until late 2008, so do you think I will have to re-pay 100% of the debt?

As you know from reading the forum, we have several members whose compulsive gambling brought them to bankruptcy. Glad to hear you are getting help for your addiction - that will go a long way with the courts. Most of us here made poor financial decisions - you aren't alone in the bad decisions department!

Interesting that your attorney advised you not to reveal your gambling since so much of your debt is related to it. Have you met with any other bankruptcy attorneys in your area? It's a good idea to set up free consultations with 3-4 just to get their different viewpoints and see which one you feel you can get along with best and will represent your interests well before retaining one.

Since by law your financial picture is set on the day you file, the fact that you will make more money in the future doesn't enter into your income calculation. The forms look at what you made for the past six months. You can't be pushed into a Ch 13 without sufficient disposable income showing on the Means Test to pay your creditors back what they would get in a Ch 7 (usually around $100-160/month). If you have no disposable income when you file, then you can't forced into Ch 13.

Hang in there. We are all human and make mistakes. What counts is if we learn from our mistakes, and it sounds like you have. Come back with questions and if you just need a place to vent any time - that's why we're here!

[Walnut]

Don't the trustees normally ask what caused you to run into your situation? I think you should shop around and make sure you get an Attorney you feel comfortable with. Your case is probably a slam-dunk Ch. 7 if you didn't omit anything. Not all of us are dead-beats or people trying to get away with something. Most filers are honest hard-working people that made some bad decisions - oftentimes they compound themselves. Some are victims of the system - credit is just as addictive as gambling and as I watch TV here I see at least two credit card commercials every ten minutes.

[SinkingFast]

Don't the trustees normally ask what caused you to run into your situation?

Some do. Some don't. If the debt was run up quickly, in large amounts, over a short period of time, immediately prior to filing, chances are the Trustee is gonna ask.

Even tho in BK Court debt is supposed to be debt is supposed to be debt,......... Some Trustees bring their own personal bias to the Table.

I'm guessing your attny suggested not mentioning gambling because he/she knows your Trustees. Possibly your Trustees don't have much sympathy for gamblers. Maybe even make their lives harder by requesting lots of CC and bank statements. Gambling/Casino records. Possibly paperwork you may or may not have.

If you keep your mouth shut, unless asked, you might just slip thru unnoticed. That could be your attny's line of thinking.

[sylvester30]

Additional Q

I appreciate all the feedback, thank you.

We both filed seperate cases last week. We were told that the 341 meeting of the creditors would be in about 4-6 weeks from our filing date. Given that we will not have any income until we graduate in 2008 I guess they cannot force a Chapter 13, at least that's what someone posted. However, I believe the attorney mentioned that in certain cases the trustee can postpone the re-payment phase until the filers begin working. Has anyone heard of this happening? Ultimately, I'm hoping for a discharge and a clean start. Am I correct in assuming that my fiance's case will be discharged without question seen as I 'm the one responsible for her debt? I feel horrible that I got her into this situation.

Also, when do filers have to go before a BK Judge? If the trustee objects to my case what can I do? Can I try to file again 6 months down the road? I will be a resident in a different state by then.

Last question, if my case is denied will it show up on my credit report that I attempted BK?

Thanks.

[SinkingFast]

Doesn't matter who ran up the debt, ultimately the debt is the responsibility of the primary User. That's how the Creditors see it. That's how the BK Court will see it.

You read right. A Trustee cannot Confirm a Ch 13 payment Plan unless the Trustee believes the Debtor/Filer has a reasonable capability to make the payments. If you aren't working, you cannot pay.

Personally, I've never heard of a Trustee "delaying" payments in a Ch 13 Plan. Not saying it don't happen. Just never heard of it.

Just because you Graduate from MIT/UCLA/Harvard/Wherever does not guarantee you'll land a great paying job. You could wind up at Wal-Mart working Sporting Goods for $8/hr.

[sylvester30]

If Case is dismissed??

q

[lrprn]

If our cases do not go through what are our options at that point? Can we re-attempt to file?

Yes, you can refile if your case was not dismissed with prejudice.

Would we have a chance to go before a BK judge?

If your lawyer files a brief stating your position and your trustee does not agree with your lawyer's position, then yes.

Utimately, can we let our creditors just sue us? At least then we could have our day in court.

This is a day in court that you may not want to have. Your creditors are going to sue you to garnish your wages and repossess your assets. Since the contracts you signed with them are legitimate, speaking to the judge won't change the law, although you could plead for sympathy to delay the garnishments, etc until after you finish school. The judge might allow that, or might not.

Please let me know your thoughts.

Sylvester, here are my thoughts for what they are worth. It sounds like it's time for you and your fiance to make appointments for free consultations with several bankruptcy lawyers to find out what are your best options in your unique circumstances. As you have seen, there are some very knowledgeable consumers hanging out here, but we aren't lawyers. You need sound legal advice to make the right choices for your and your future wife's life for many years to come. The decisions you make now could haunt you for decades to come if you choose the wrong way to go. You want to make the very best decisions at this point, so it's time to get the best legal advice you can as soon as you can so you know what you are up against. Keep coming back for support any time you need it and please let us know what you find out.

[HHM]

You said you already filed last week. So if things go awry, it may be a little late to do anything about it now.

Chapter 13 is not your main worry, the main concern is a possible abuse of process motion (this is why your attorney told you not to mention gambling, however, realize that at the 341 meeting, you will be under oath). Coming clean, at least voluntarily is probably not in your interests. Not to be a downer, but with that level of debt, and the fact that your credit card statements will bare out where some of this money went, I would not be surprised if some creditors come out of the wood work to file objections to discharge (arguing, how could you have reasonably expected to pay back such debt when you are a student and hardly work).

I hope it works out for you, I really do, but my gut tells me this case is headed for at least a couple objections to discharge, possible dismissal for abuse, and perhaps even a prosecution for bankruptcy abuse. The one good thing you have going for you is that the two of you are not married, thus, the creditors and the trustee will probably not put two and two together, and both your cases may slip by.

[Spartan]

Since the debts started around August of 2006, and the amount is HUMONGOUS, my money is on the trustee asking where the money went. You got no asset. So... What happened to the money?

I would think there is presumption of abuse here.

That would be the same situation for your SO's case.

That is what my attorney, who is also a private trustee, said would happen. I was concerned about my 6 figures debt and no asset. Hence I asked her if the trustee would ask where the money went. Her answer was, if happened recently, the trustee would wonder if you were hiding the money. If it happened many years ago, as in my case, then it isn't an issue. When I got my notice of 341, there is no presumption of abuse mentioned.


Since you will be under oath, you will have to tell the truth. The same goes for your SO. The saving grace is, you are seeking treatment. If I were you, I would get a letter from my doctor/counsellor, proving that I am under his/her treatment for my gambling problem.


By the way, before you go to bed everynight, you should be on your knees thanking your creator that you have such a great gal in your SO, who, after all the crap you have pulled, not only didn't put a contract out on you, but taking you back instead.

After reading this thread, I have only one word, UNBELIEVABLE.


Good luck.

[ChainSmokin]

[sylvester30]

Help

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[ChainSmokin]

I know it helps quite a bit, when were your last credit card charges?



I believe you have to live in the new state for two years.

[SinkingFast]

Personally, since you already filed, I'd just ride it out and see what happens.

Keep your mouth shut. Answer what questions you have to as short and sweet as possible. When you go to the 341, do not sit with your FI. Look as much like total strangers as you can.

You could be borrowing trouble. As HHM said, with different last names, the Trustee may not even make the connection. You both may slip under the Court's radar.

[aa06a47]

Sylvester, one thing you need to take to the 341 meeting with you is win/loss statements from the gambling casino's just in case it comes up. In my case..similiar to you except the debt was over a longer period of time, I used the win/loss statement to prove I lost money gambling. It was never an issue when I showed the proof.

With that amount of unsecured, and appears it was racked up in a short period of time, you are at risk of being asked questions. If you have proof that you lost the money, the trustee will accept it.

Go to the casino's and ask for a win/loss statement for 06. I hope you used a players card while doing your gambling. If not, make up a record of how much you lost, what day, etc. (Might take time to reconstruct, but you should be able to come close enough to show the losses)

I would not withdrawal the Chapter 7 filing. It is obvious that you are unable to pay the debt. In my opinion, the credit card companies were complete fools for giving you and your significant other that type of credit limits with no jobs to support it. While you admit responsibility, in your case, I think they are as much to blame as a college student living on financial aid.

Good luck, let us know what happens.