help need answers

[deadmonetree]

My husband and i just brought up the thought of bankruptsy 2 days ago. to be a short as possible 1 1/2 years ago bought a house Since then debt has spiraled out of control and i did not even relize how much until we refinanced our house this month and figuring out if we could pay anything off and than i was like how are we even paying anything net is 3700 bills equall more like 4400 so i think we used the cc to survive and so this is my situation... chase\wamu has our bank account and as of the merge and now chase will also have 5 of the cc owing to them as wamu bought providian and chase bought wamu there is a us bank and discover and citibank had a 1000 cash advance in december because refi didnt get done before 31st and we were told everything is fine so i spent part of mortgage for bills and christmas. total debt is about 60000.00 plus we just bought a car 4 months ago (reading this i am thinking how could we not of seen this) About a year ago my mother took some of our debt about 12000 and we have been paying that well i want to use a convienience check to get that 12000 back so i can include it. It came off of providian so can i put it back? as long as i wait the 90 days will i be fine? I do not want a fraud and I am not frauding it is my debt but why would we claim and still keep 12000 seems kind of stupid I do not know if we can wait for more than 90 days but i dont want an abuse claim either please help!! Last question i see that not reaffirming is the smarter way to go because you still have protection if the worst happens so if you still pay the car loan and house mortgage they will NOT take the property back? I dont want to wonder if i leave my car in the driveway it could be gone or all of a sudden i am kicked out of our house! and yes i have spent 2 days goin through all the post so i am not asking something that i can find all over the posts. have a good day sorry so long

[SVBroke]

I am fairly new to the BK process as well, but I do know that you need to stop taking cash advances. Based on discussions with my lawyer and reading other post on the site, you will need to try to make a few months of payments to these cards before you file to show good faith in trying to payback the debt. Try to wait 3-6 months from the last cash advance before you file.

If you use a convenience check to pay back your mother, that would be seen as preferential payment and the trustee would most likely go after you mother to get the money back. You can still include the $12,000 in the BK; you will list your mother as a creditor. If you want to still pay her back after the discharge of the BK, you can.

Have you talked to a lawyer yet? If not, you might want to talk to a few about your situation. They will be able to give you a better idea of whether you can file Ch. 7 or 13 based on your financial situation. It might also give you a little peace of mind and get a game plan together for filing.

[deadmonetree]

thanks for the input i am trying to get everything in order before we talk to a lawyer. I cann not claim my mother as a creditor for one she took a loan out to take our debt and i dont think she would ever talk to me again! really! so i would like to include it but i dont know if we could stay afloat for 6-12 months with this credit card debt.

[SVBroke]

What if you stop paying on any credit cards you have not made any large charges on (say over $500) in the last 3 months. Pay the minimum due on the cards you have use for at least 3 months. Hopefully, that will free up some money until you can file.

If you want to keep your house and file Chapter 7, you have to be update on your payments, with not a lot equity or not more equity than what can be claimed as an exemption in your state. If you get behind on you mortgage payments, you can file Chapter 13 and basically get caught-up inside the BK payment.

As for the $12,000 loan / debt you mother took out in her name for your use, if you use a credit card check to pay her and then file BK, I think you are going to have a few problems. The first being, that creditor will most likely challenge that debt being discharged. You would most likely have to reaffirm the $12,000 debt, it will not get wiped out.

I'm sure a few more people will chime in with their opinions on this matter.

For now, just take a deep breath, you are not going to lose your home over being a month late. And you won't lose your cars for being a little late on the payment. You still have time to figure the best course of action. Hang in there!

[deadmonetree]

thanks so much I didnt know we were so bad! actually everything is up to date we have no lates on anything but 60,000 in cc and mortgage and car pymnt is swallowing us deeper and deeper.(obviously living on cc more than we hought) We want to keep the car and the house just want all the cc debt gone and i am troubled about claiming bkrtcy and still haveing 12000 in debt.

[ansky0007]

Take a step back and look at all of your finances... I notice you said you just re-financed your home. That would mean to me that if the bank gave you the refinance in todays market you should have equity in the home? How much equity is in your home? If you file bankruptcy all your assets including equity need to be accounted for. If you have equity in your home the BK trustee can sell the house and use the equity to pay back your creditors... The same can go for your car, bank accounts, etc.

You are allowed some exemptions but you need to list everything if you want some good recomendations.

[deadmonetree]

we have lived in it for 1year and 4 months i dont belive we have equity it appraised for 275000 and we owe 239000 but the appraisal was when the market here in phoenix just started to fall my whole street is forclosed on so it could be worth less than what we owe. have a new vehichle 4 months in dont have equity there either than that... 50000in cc 12000mom 2000sears 700bestbuy want to keep house and car we do have another car but i guess its worth 400

[hereforinfo]

You may want to rethink keeping your house. With a mortgage of $239k, your payments with property taxes and insurance must be pushing $2000/month, right? That is more than half your net income, and you will likely just end up right back where you are. What is your car payment?

[deadmonetree]

1400 is mortgage 600 car pymnt all the rest are cc bills and of course water and elect

[eddiep]

deadmonetree

I think you are my long lost twin! Our stories are so similar, except that we ALMOST borrowed 20k from my father in law this summer! He actually remortgaged his home, the loan was approved and the bank was just waiting for him to pick up the check! Thank god I talked my husband out of it.

If you had told me a year ago that we would be filing for bankruptcy I would have told you that you were crazy. Now I can't believe we didn't see this coming! We thought we were doing fine, we were making all our payments on time, but then the minimum payments got so high that we had to charge everything else including the utilities and groceries! Then the cc companies cut our credit line down to what we owed! It just got out of control so fast! Then my husband lost his job and was out of work from September to December!

I can't offer much advice as I am only one step ahead of you but... My advice is talk to a lawyer! We hired one last night and will be filing in the next two months. I have to finalize a mortgage modification before we file. We were afraid we would lose everything if we filed. I feel so much better after talking to him. All our assets should be protected by a combination of exemptions and a "wild card". We have two cars, 1 truck, a motorcycle, a dirtbike, a boat, and an ATV. They are all worth 2k or less. We may even be able to keep 10k from a personal injury lawsuit that isn't settled yet. Good luck, I know how you feel.

[deadmonetree]

i wish now i would have never done it! actually about a month after i knew! so what do you have to do with your house? i just finished with a refi for better interest rate and i am kinda leary about what they are going to do about the house. definitly want to keep it. i just dont know how to get around the money thing either i would take the loan back in a second but i dont want to raise flags and dont know if 4 months would be enough! And yeah would not believe i would be thinking this a year ago!! boy did it spiral out of control!! I just figured husbands income was covering everything in fact i was bling until last night and my husband and i cant even figure out how we have been paying everything cuz the math A+B does not equall C

[eddiep]

The lawyer said my house was fine if I was up to date with payments and there was not more than 100k equity (NH exemption). I can keep it. I am trying to do a refinance too but our credit score is BAD and can't do traditional refi. Spoke with bank and they said they can help with a manual underwriting as long as I am up to date with payments and I am. What were your plans to repay the loan originally? I think you can continue to pay any loan you chose. I had asked if we could keep one card that was not maxed out and not past due. He said I could but would not recommend it because usually as soon as cc company finds out about the bankruptcy (after the court settles it) they will close the account so I can't use it but will have to pay it back. I know you would like to write it off and I don't blame you but could you afford to pay her back if all your other debt was gone? We did borrow money from family ($5000) while he was not working and we are going to sell some assets after we settle the bankruptcy. Don't forget, you can't start making payments to her until after the discharge! They can demand the money back from her and will take the money you gave her and give it to your other creditors!!!!

[deadmonetree]

can i pay her out of my taxes since i have not filed yet? i dont hink we are going to file until march if we have to wait april

[StartingOver08]

can i pay her out of my taxes since i have not filed yet? i dont hink we are going to file until march if we have to wait april

No, this is an insider payment with a lookback period of one year

[deadmonetree]

i guess i will just keep paying her. really wish i could just put the debt in my name i think more than oweing it i just dont want to owe her anymore.YES i love my mom just not the person you want to be in debt to. so we want to keep the house and keep the car we are upside on the car but am looking for a way to refi the car during the bankruptcy so we can not be upside down. everything else can go I am going to be a cash only person forever now!! The funny thing is got mail today from one of the creditors today adding 5000 to my limit!!! He said due to your excellnt payment history. We are not late on anything but cant they see 60000 in cc debt!!! were in a black hole!! we just happened to look at our finances this week and were like OMG what have we done and for them to do this they have to know and they want you drowning in it!