Hi all...I am really hoping I can get some advice on my situation.
I became involved in a business venture with a friend of mine, personally guaranteeing loans on the business with the bank. Long story short, the venture failed, and the bank is after me for my guaranty. The guaranty was limited to approximately $1,000,000. Since it was business debt, my attorney said I would be able to file for Chapter 7 no problem.
Several weeks before I filed for Chapter 7, the bank unilaterally reduced the guaranty amount down to $500,000. While it seems on the surface like a good thing, It was actually done to by the bank to lower my business debt below my consumer debt level (my mortgage and credit cards), with the intention of forcing me to have to pass the means test to continue to be eligible to file for Chapter 7. My attorney however has told me I cannot pass the means test and that I would be forced to file for Chapter 11. I would imagine the bank is anticipating this and thinks they will get more money out of me if I did this instead of Chapter 7. Anyway, my attorney is filing on my behalf for Chapter 7, intending to challenge the bank's ability to unilaterally lower the guaranty to where it is now.
My question is basically this: Has anyone had this done to them before, and were they as debtors able to successfully file a Ch. 7 in spite of this action? It seems to me that something done like this by the bank on the eve of my filing bankruptcy would have to require my consent.
Thanks for your help.
I became involved in a business venture with a friend of mine, personally guaranteeing loans on the business with the bank. Long story short, the venture failed, and the bank is after me for my guaranty. The guaranty was limited to approximately $1,000,000. Since it was business debt, my attorney said I would be able to file for Chapter 7 no problem.
Several weeks before I filed for Chapter 7, the bank unilaterally reduced the guaranty amount down to $500,000. While it seems on the surface like a good thing, It was actually done to by the bank to lower my business debt below my consumer debt level (my mortgage and credit cards), with the intention of forcing me to have to pass the means test to continue to be eligible to file for Chapter 7. My attorney however has told me I cannot pass the means test and that I would be forced to file for Chapter 11. I would imagine the bank is anticipating this and thinks they will get more money out of me if I did this instead of Chapter 7. Anyway, my attorney is filing on my behalf for Chapter 7, intending to challenge the bank's ability to unilaterally lower the guaranty to where it is now.
My question is basically this: Has anyone had this done to them before, and were they as debtors able to successfully file a Ch. 7 in spite of this action? It seems to me that something done like this by the bank on the eve of my filing bankruptcy would have to require my consent.
Thanks for your help.
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