What can they do to me?

[kartoons19]

Doran,

I can relate to your situation. I am also self-employed, $78K in CC debt plus student loans. Up until Mar I was never late, ever, and it was difficult not to pay, but I realized that something had to change. I did try to go through Legal Aid because I couldn't afford the atty, but they rejected my case because I was judgment proof so there wasn't any income/assets the creditors could take.

You have time to consider your options. In the 3 months of not paying cc's I do get a lot of calls, which is why I keep my ringer turned off, but their messages are cordial and so are the letters. This also gives you time to learn about the BK process, which can help allievate some of the fear. This board is an awesome resource and so are the nolo books.

Good luck to you.

[brokenomore]

Second reply...

We are not covered by Shaira Law, so they will not take your hands or head. We are not in Mexico, so they will not toss you in a cell and bill your relatives to pay your debts to free you. We have no debtors prisons. Worst case is that your name will appear in the smallest possible typeface in a section of the newspaper that nobody reads anymore. And that only happens after all your debts are discharged and you are free to go about your life like millions of others do.

Did you know that over 30,000 people file bankruptcy every day?

Yes, every day.

And nobody loses their freedom if they are honest when answering the trustee's questions and filling out their paperwork.

The rest is just "stuff", and you probably won't lose that, either.

That would be almost 11,000,000 a year or over 100 million in ten years, which would be about half the adult population of the us having filed for bankruptcy in a ten year period.

Is that 30,000 figure per day for just the US?

[freeatlast98]

Means test and self-employment

Your self employed? So am I and am under the impression that 1: no one can garnish any wages from you...
2: You don't have to take the "means" test if your self employed...as long as you barely pay your bills, living expensives, etc.. with little money left over...your fine.
Good luck.
I haven't paid anyone if almost 2 years now still calls but no action

Just a question because I'm also self-employed. I don't have to take the "means" test. I'm filing Chapter 7 in the next few months or so. So is that one form i don't have to include when I file?

[doron]

Doran,

I can relate to your situation. .. This also gives you time to learn about the BK process, which can help allievate some of the fear. This board is an awesome resource and so are the nolo books.

Good luck to you.

Thanks. Very glad I found this board.

[music12]

it was about 800,000 ch. 7's in 2009. the 30,000 is probably more like monthly rather than daily. google bankruptcy statistics and you'll find all the data.

[BCA2009]

According to the US federal court website. There were 1,457,794 chap 7 and chap 13 filings in 2009. Assuming a family of three per household/BK case, that would be 4,373,382 people in a BK households that filed cases in 2009. That would be 1.5% of the US population. If that trend hold up for 4 years, that would be 6% of the population directly inculed in a BK case. I don't know what the trends have been in previous years, but 1.5% per year seems like alot to me.

[music12]

yeah, that's a lot. but i wouldn't count kids...

[GettingGoing]

yeah, that's a lot. but i wouldn't count kids...

Why not? Its these damned kids that lead so many of us to bk. J/K

[music12]

not funny! but you are 2 days post your 341, you are allowed to make awful jokes

[BCA2009]

yeah, that's a lot. but i wouldn't count kids...

I understand that kinds don't file BK. But kids in most homes that have filed BK sure are affected by it. That was my point.

[brokenomore]

it was about 800,000 ch. 7's in 2009. the 30,000 is probably more like monthly rather than daily. google bankruptcy statistics and you'll find all the data.

30,000 per day is way off.

It's more like 2,200 per day, based on that 800,000 per year figure.

[shark66]

@doron:

Your current financial situation makes you pretty much collection proof. If you told us in which state you reside and what's the BBK value of your car, we might be able to advise you better...

Now, do bear in mind that for bankruptcy purposes in quite a few areas the cars are valued at wholesale, basically what the dealer would pay for them at the auction. Almost any ten year old car - short of exotic brands - could possibly be brought close to being fully exempt (you don't own that weird Lamborghini SUV from the late 90s, do you? That one might just prove difficult to exempt...LOL) in quite a few states. Consult the NADA website for more details.

http://www.nadaguides.com/

As for what they can do to you...in the current set of circumstances, next to nothing. Most of them will take quite a while before they sue, easily six months, although it has been more than two years in my wife's case, and not all of the creditors have sued us, quite the contrary.

You've got ways to go. Trust me on that one.

I'm far from being a lawyer myself, but have studied the issues that pertained to my situation (this forum is a tremendous well of knowledge), filed Ch. 13 on my own and had a smile on my face ever since.

Make no mistake though. Had I found a lawyer that I found trustworthy, I would've hired him or her. But one can do it by themselves, especially if they're looking at Ch. 7...NOLO book is a great introduction to the whole process.

Chill out. You'll be fine.

Good luck.

[NewPage]

Thank you for your responses.

OK, I've always paid my bills on time, always, always, you see, so this is hard. So most people stop paying CCs and after a while file, rather than the reverse?

Believe me, I understand. Not making the payment the first time was the hardest thing ever. But not struggling any more is a good feeling. I just want to be free of this debt.

Yes, if you are filing, quit paying your cards. Save the money for your attorney, build a cushion (up to your exemption amount). Buy supplies. You'll be okay.

[2manybills]

Believe me, I understand. Not making the payment the first time was the hardest thing ever. But not struggling any more is a good feeling. I just want to be free of this debt.

Yes, if you are filing, quit paying your cards. Save the money for your attorney, build a cushion (up to your exemption amount). Buy supplies. You'll be okay.

Honestly that was the hardest for me. To stop running around on the hamster wheel and say STOP THE INSANITY! Once I passed the initial not paying, it became better everyday and has ever since. I spent so much energy juggling and robbing from Peter to pay Paul.

[JackBondLove]

You seem to be judgement proof, so you have nothing to lose, even if your creditors would sue you.

To me, the thing that determines whether Chapter 7 would be a good strategic move is how underwater a debtor is for unsecured credit (or the part of secured credit that is over the value of the securing asset) vs. non-exempt assets. If someone were not underwater, then BK would be a foolish move. If someone is were underwater, then it becomes a question of how much underwater vs. how much future financial pain would be encountered due to the BK (e.g., loss of use of credit cards, higher interest rates on home loans, etc.), as well as the cost of the BK attorney. I have determined that the current discounted cost of the future financial pain as somewhere b/w $5K and at most $20K. At $80K, you are well north of the $20K.

You need to stop making credit card payments NOW, and think about how you are going to survive from here on. As your cash will run out soon - especially considering that you will need to pay for an attorney to file BK - you need to find a job just to eat, no matter how low (I am presuming that you do not have a large IRA/401K that you could tap to survive.) I was just eating at my favorite local Middle Eastern restaurant, and a guy with a degree in business was applying to be a waiter - hey, that's the reality today.

You will start getting nasty calls - simply turn off the ringer and take a few calls now and then, and then say that you are considering filing Chapter 7. Once you have found work, all you need to say is that you have been forced to take a part-time minimum wage job, and that you have no way to make any payments. DO NOT tell them who your employer is - say that you have been advised to only give that information out on a Chapter 7 filing document. If asked what your income is, say that is variable, but that is part-time and near minimum wage. The creditor henchmen will try to cajole you into making a payment.

Finally, the calendar is your friend! Try and wait as long as possible to delay filing. One year after any credit card use would be ideal, but even 6 months would be good. I would not be concerned with the luxury purchases, so long as you file after 6 months - and in any case $1K is not much. If you would be scrounging around at a cr@p job, it would not matter until a creditor would due you to garnish your wages, at which time you could delay for while and file BK on the eve of the court case, if it were to come to that.

Get your affairs in order - all your creditor and financial statements, tax forms for the last 2 years, expenses, IRA contributions, etc. - and then summarize them to be able to talk to an attorney. One piece of important information is the last time a credit card had zero balance, and the last time it had been used. Then go have some initial consultations with BK attorneys. I simply let my fingers do the walking via the internet and talked to a few folks, and selected my attorney who seemed to be an aggressive fighter, as opposed to others that just wanted to cakewalk through it. When you select an attorney, you will get a packet to fill out (that he will use to file the official filing document) - go ahead and fill this out so that when the time would come to file, you'll be ready. Also, don't forget to have the $1500 or whatever in the bank to be able to pay for the attorney!

Good luck - keep us informed!