If Creditor Objects - Ch. 7 - Possible Outcomes

[ApresMoi]

your creditors won't know how much $$ you have in the bank account until they levy on it. if you have $50, they will get that minus the bank's levy fee, which ranges between $50 and $100. now, i don't know if you'll end up owing the difference to the bank...

it's not totally true that a creditor can't seize bank accounts they don't know about. all they need to do is summon the debtor to an examination, where you will be required to say, under oath, where all your money is. but this process could take a couple of months, and can only start after they have sued you and gotten a judgment.

i think you should wait the 90 days. if you can reduce the risk of an AP, it's well worth it.

now, i don't know whether banks have a system where they know not to levy on an account that has only exempt funds. my bank certainly did not care, and i am still trying to get the $$ back after a year... try to find out whether they can set up a special exempt account for you. i am not sure how they would do that, though, because i don't know how the bank can prevent you from depositing other, non-exempt funds in there...

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I think if they sued me, I could appear before the judge and say all my property and cash are exempt under CA law. Pretty sure it all is.

[ApresMoi]

first, i think you are several months away from any accounts begin frozen. you don't need to close anything before you get a summons.

it's scary what you say about chexsystems. i didn't think of that.

once my account got frozen, i went cash only for a very long time. it's inconvenient and costs money for the money orders, but it's the only 100% safe thing to do. like in birth control, you can get up to, like, 99% control, but if you want to be 100% sure, just don't do it!

i'm still trying to get frozen money back. it was all unemployment, exempt, but nobody - including the court, mind you - cared. on paper, the law helps the little people. in practice, it helps the big guys.

*************8

My funds are all from unemployment benefits. I too think I am at least a month away from the accounts being at much of a risk, and realistically, probably closer to two months away. As you know (having been through this), that provides little in the way of peace of mind. So I am learning as much as i can. The only thing I have seen advised is to write a letter to your bank pointing out that your funds are exempt.

One thing that concerns me...I read that exempt public benefit funds are exempt IF direct deposted. And if not direct deposited? California's unemployment department is not set up to DO direct deposit. Does this mean these funds are not exempt? Even if I set up a special exempt account?

Going all cash would be a huge pain, so I should probably file BK before it gets to that stage.

Thank you for sharing your experience.

[music12]

mine were direct deposited, the judge and the person suing me were made aware of it, and it's been a year and i'm still chasing the money. the system is as good or bad as the people participating in it.

[ApresMoi]

mine were direct deposited, the judge and the person suing me were made aware of it, and it's been a year and i'm still chasing the money. the system is as good or bad as the people participating in it.

Sorry to hear that. And that's disheartening. This just makes me more determined to file to avoid these kinds of hassles.

[ApresMoi]

mine were direct deposited, the judge and the person suing me were made aware of it, and it's been a year and i'm still chasing the money. the system is as good or bad as the people participating in it.

how much time elapsed from when you stopped making payments and when the accounts were frozen?

[BrokenBrklyn]

I owed Citibank 31,000.00 on one credit card. I stopped paying in Feb. two weeks before hiring my bankruptcy lawyer, I didn't file for bankruptcy until Nov.

I never had any problems with my bank account. As a precaution, I didn't put anything in it from March-Nov until after I filed. If you're just now stopping payment, you'll be fine.

Also, you'll probably be fine with the BK, I would go consult a lawyer, I don't know your circumstance but afterward I would start defaulting on everything and wait your 90 days.. When I discovered I had to file, I decided either way, I had nothing to lose and I liked keeping my money.

[ApresMoi]

I owed Citibank 31,000.00 on one credit card. I stopped paying in Feb. two weeks before hiring my bankruptcy lawyer, I didn't file for bankruptcy until Nov.

I never had any problems with my bank account. As a precaution, I didn't put anything in it from March-Nov until after I filed. If you're just now stopping payment, you'll be fine.

Also, you'll probably be fine with the BK, I would go consult a lawyer, I don't know your circumstance but afterward I would start defaulting on everything and wait your 90 days.. When I discovered I had to file, I decided either way, I had nothing to lose and I liked keeping my money.

I think I probably will file, but the lack of freedom during bankruptcy is troubling, I must say. I can't sell anything, can't pay family members back on a small loan, etc. It feels like lockdown (I would Imagine) and I haven't even filed yet! Anyway, thanks for sharing the timeline...helpful. Someone else posted they don't know how much you have in any account when they levy, so I think one has to go by time lapsed. I stopped paying in November, so it's too early for the to freeze (I would think).

[ApresMoi]

If it's only $1,500 and across a couple of cards, I would say that you would really have not issues if you wait out the 90 days. Reason why... an AP can cost at minimum $4K to prosecute, so most creditors don't bother for anything less than that amount!

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I am back on this topic yet again (just read HHM's excellent 'stickie'). My concern is having told one of the creditors that "it's been awhile" (referring to length of unemployment) and a couple of other foolish (in retrospect) statements. They may say I 'knew' I wasn't going to be able to replace my good paying job, and I continued to use the credit cards anyway.

Here's the question. I looked back at the charges on each of the three cards for the last six months of card use, and see only normal living expenses (though one creditor may question whether paying for a storage rental is 'necessary', I really don't know). Every month, my payments equaled or exceeded (if only slightly) the amounts charged. Over time, the balances increased due to the finance charges.

Given the above facts, is there much chance a creditor would say, she used the cards knowing full well, as a long-term unemployed, that her chances of being able to pay us were slim to none? And bring an Adverarial Proceeding? I plan to wait 90 days before filing.

I wondered too if I file pro se whether they may see me as a) someone not very knowledgeable about the law and, therefore, b) someone who they could bully into a settlement.

[HakunaMatata]

I don't think you have a problem. It doesn't appear you have any luxury purchases and I suspect your charges aren't exceedingly high. Think like a creditor...would it be worth $4k+ to file an AP?

I had similar concerns; however, my situation was slightly different...I was employed with a consistent income. For years, I used one card for necessities (averaging $1k per month) and paid it off monthly. In the (semi-denial) months leading up to filing, I continued to make charges and began paying the minimum. I ceased CC use 60 days prior to filing. I was recently discharged without any problems (not even the slightest question regarding my recent charges or altered payment behavior).

[justbroke]

Given the above facts, is there much chance a creditor would say, she used the cards knowing full well, as a long-term unemployed, that her chances of being able to pay us were slim to none? And bring an Adverarial Proceeding? I plan to wait 90 days before filing.

I'll just repeat myself. Less than $4,000 and across several cards... at worse, they'll "threaten" to file a complaint (Adversary Proceeding/AP). More than likely, you'll NEVER hear a word.

I wondered too if I file pro se whether they may see me as a) someone not very knowledgeable about the law and, therefore, b) someone who they could bully into a settlement.

I had charges up to the day of filing! (I was traveling for work and charging to my World Mastercard. I didn't know I shouldn't be spending.) I never heard a word.

[ApresMoi]

I'll just repeat myself. Less than $4,000 and across several cards... at worse, they'll "threaten" to file a complaint (Adversary Proceeding/AP). More than likely, you'll NEVER hear a word.

I had charges up to the day of filing! (I was traveling for work and charging to my World Mastercard. I didn't know I shouldn't be spending.) I never heard a word.

Ok, thanks. The reason I was concerned is that the attorney indicated there was 'some risk'. Though by the time the conversation ended, I was under the impression he had not fully reviewed my info (he requested some advance info to prepare for the free consult). Based on what I am seeing here, the risk is very minimal to none.

[ApresMoi]

I don't think you have a problem. It doesn't appear you have any luxury purchases and I suspect your charges aren't exceedingly high. Think like a creditor...would it be worth $4k+ to file an AP?

I had similar concerns; however, my situation was slightly different...I was employed with a consistent income. For years, I used one card for necessities (averaging $1k per month) and paid it off monthly. In the (semi-denial) months leading up to filing, I continued to make charges and began paying the minimum. I ceased CC use 60 days prior to filing. I was recently discharged without any problems (not even the slightest question regarding my recent charges or altered payment behavior).

No, no luxury good purchased during that period (or even prior to the six months). That's not how I used the cards. When you are unemployed, the transactions become very defined, shall we say. Food, gas -- the basics. :-)