New here with California CH7 questions

[BK4me2009]

Hi everyone, I have been lurking for months reading and trying to put into action all of your wonderful advice i've read, however my circumstances are a bit off lol

My husband and I have a little over 40k in cc debt
We do NOT own a home
We are both self employed - Is this a big no no?
I am a college student (with a only 1 loan that won't even come up for another 2 years for payments)
My husbands "tools of the trade" are under the limit
We are only late on the Cc's

A little background, we had NEVER considered bankruptcy NOR had we ever been late, UNTIL my mother stole my identity and opened up CC's with my social and my sister's name, screwing us both. All of our credit cards are joint and unfortunately the only business card we have is our Home Depot card (we own a small repair company).

Most of our debt is old and we have always been current. I found out my identity was stolen after I started receiving letters from our credit card companies that our limits were reduced and our APRs increased, therefore causing our minimums to go up dramatically.

Then we fell behind, the economy isn't doing well for construction. We gross maybe $40,000 a year in California (per tax returns after schedule C).
We would like to keep our cars and have not been behind, owe more than they are worth and from what I've seen we should be fine.

My decided in Feb to stop paying the cc's, however we have to use the Home Depot Card, will this effect filing? Will this be closed automatically after filing? Home Depot Card is owned by Citi and Citi is one of our creditors.

Do we have to file for our businesses? We're making money, just barely enough to survive in California.

How much cash can we have on hand in California? We have an adequate mattress savings of about $4000.00, what is the limit in CA as far as cash? Our rent alone is $1500 a month, plus daycare of $1000 a month, I wouldn't think that $4000 would be an outrageous number.

We have not used CC's since January.

How will this effect our cars if we reaffirm them, will our current interest rates go up? they're 6% and 9% with less than 10k owed on each.

Will I be able to get another student loan after filing?

I'll probably have more but right now I think the cash and business ones are the biggest questions. Thanks for your help.

[jribe]

Hi,
Since you don't own a home, California has a homestead exemption of 20k that can be used for any other property.

We're in the same boat as far as that goes, we don't own a home; so even though we have a fair amount in our accounts- we can cover everything under that 20k exemption.

How is your business set up? If it is a sole prop, there is no seperation between yourself and the business; thus it would be in BK as well.

Will you be including the Home Depot card in your BK? If so, DONT use it! If you have used it; be sure to wait the 90 days before filing (although i have seen many people get away with filing in 30-60 days depending onthe amount charged before filing).

If you reaffirm the cars; your contracts stay the same. It just means that if for some reason something happens in the future - there is no way to get out of paying them.

Student loans can still be received after BK; private loans will be hard (but you don't want those anyway) so go stafford.

Hi everyone, I have been lurking for months reading and trying to put into action all of your wonderful advice i've read, however my circumstances are a bit off lol

My husband and I have a little over 40k in cc debt
We do NOT own a home
We are both self employed - Is this a big no no?
I am a college student (with a only 1 loan that won't even come up for another 2 years for payments)
My husbands "tools of the trade" are under the limit
We are only late on the Cc's

A little background, we had NEVER considered bankruptcy NOR had we ever been late, UNTIL my mother stole my identity and opened up CC's with my social and my sister's name, screwing us both. All of our credit cards are joint and unfortunately the only business card we have is our Home Depot card (we own a small repair company).

Most of our debt is old and we have always been current. I found out my identity was stolen after I started receiving letters from our credit card companies that our limits were reduced and our APRs increased, therefore causing our minimums to go up dramatically.

Then we fell behind, the economy isn't doing well for construction. We gross maybe $40,000 a year in California (per tax returns after schedule C).
We would like to keep our cars and have not been behind, owe more than they are worth and from what I've seen we should be fine.

My decided in Feb to stop paying the cc's, however we have to use the Home Depot Card, will this effect filing? Will this be closed automatically after filing? Home Depot Card is owned by Citi and Citi is one of our creditors.

Do we have to file for our businesses? We're making money, just barely enough to survive in California.

How much cash can we have on hand in California? We have an adequate mattress savings of about $4000.00, what is the limit in CA as far as cash? Our rent alone is $1500 a month, plus daycare of $1000 a month, I wouldn't think that $4000 would be an outrageous number.

We have not used CC's since January.

How will this effect our cars if we reaffirm them, will our current interest rates go up? they're 6% and 9% with less than 10k owed on each.

Will I be able to get another student loan after filing?

I'll probably have more but right now I think the cash and business ones are the biggest questions. Thanks for your help.

[ready2puke]

I'd get a debit card and use that for work thats what I did for my business. I have to buy products (skincare). After I stopped using a cc which was last Aug. I went to cash, check, and debit..its so freeing..

[BK4me2009]

Yes we are Sole Prop.

Yes we want to keep the home depot card because we have to pay materials up front for our clients and sometimes it takes as long as 90 days to get paid for the jobs. Putting up 5k in cash up front leaves us in a bind if we don't have any back up jobs.

Will this mess up the BK? We logically can't stop using the HD card unless we have about 20k saved, if we did that, we'd have half the cash to pay the debts.

[StartingOver08]

Your Home Depot card will be canceled the minute you file.

Any charges you put on it just before filing will mess up your BK.

[BK4me2009]

Okay thank you. Guess we'll just have to save more money before filing so we can have a cushion. Thank you.

[StartingOver08]

You need to check your states exemptions to find out how much cash you can have....just a suggestion. Check here: www.legalconsumer.com

[BK4me2009]

Hi,
Since you don't own a home, California has a homestead exemption of 20k that can be used for any other property.

Does this include cash and furnishings?

Does BK effect our business too? Will this effect our licensing and bonds?

[chad9162]

Does this include cash and furnishings?

Does BK effect our business too? Will this effect our licensing and bonds?

You need to meet with several attorneys in the area. Even if you don't use them they can give you valuable insight on how our district works.

If you need to move cash to an exempt category look at retirement accounts (this is called planning). Later on you could always pull from them if needed. Roth Ira's are a perfect example and since you're funding it with tax paid money there are no penalties on withdraws unless you take out earnings.....

Bk can affect your bond or insurance. Make an anonymous call to your bond issuer or insurance. I don't think Bk affects your sate or local license. And yes, I believe the CA exemption includes cash and any other property.