What cars can I keep? married filing individual

[jeffwo]

Hello,

I am going to file chapter 7 but my wife refuses too. She really has no debts other than the house loan. Her credit is 733 and she doesnt want to effect that..

My score is 638 and Im loaded with debt. 25K credit cards...

I want to keep my home that my wife and I live in.

I have a paid off 2003 Mercury Sable in My name alone that is actually my daughters car.

I have a 2003 F-150 Truck ( I owe about what its worth) I drive that is in both my and my wifes name.

I have a 78 trans Am.. In Both Names. Im not sure, but I might sell it prior to the bankruptcy. (nobody really drives it.) I owe about what it is worth as well.

My wife has no car. she drives a company car now, but that will end very soon and I will need to buy a vehicle for her.

Here are my questions.

Can I keep my truck and the Sable my daughter drives or should I put the Sable in my daughters name? (she is 15)

My wife will buy her own vehicle in her own name and that shouldnt be a problem.

[tcreegan]

No transfers

Hi jeffwo,

Do NOT transfer the car title to your daughter! No transfers especially to family right before a BK.

You undoubtedly can keep the Sable. Each state has an amount of value that can be exempted from the BK. An '03 Sable will be well under that value.

You can keep the truck one of two ways:

You sign a new contract w/ the lender. Called a reffirmation. Downside: you are still legally liable for the debt despite the BK.

You do a "ride through" You keep the loan current through the BK and beyond. As long as you stay current, lender doesn't/can't repossess. Downside: some lenders (FMC being one of them) don't like to do this
Upside: you are not legally liable for the debt. You can walk away later if things get tight.

Keeping the house depends somewhat on what state you are in. Is it a community property state, tenancy by the entirety, other

Last question: Sounds like you are filing bankruptcy basically for only the 25k in cc debt.....

Using a BK to get rid of cc debt is like using a 50lb brick to kill a fly. Have you consulted with a financial advisor? You have to take a class prior to filing a BK, might be worth your while to get some unbiased financial advice. You might be advised to settle your cc debt instead of filing BK.

If you do take the settlement route, be VERY careful of the scam artists out there. Use a local non-profit agency or local lawyer and nothing over the internet or off a TV ad......

Anyhow, my 2 cents, probably all it is worth....

Tom in Colo

[bigtim6656]

The issue to settlement is most will want 40 to 50% about 10to15k I would guess and want it all upfront. WHo has 15k around to pay off a CC. A 50lb brick no but maybe a 10 pound brick. Better to smash the fly then let the fly smash you

[tcreegan]

credit card use

Hi bigtime, Hi jeffwo,

Another consideration is that credit card debt settlement hits your credit report rather hard. Not as bad as a BK though !

Typical settlements seem to be 40-50% and dropping.

BUT, the big difference is how you got into the cc debt in the first place.
Ask yourself, after the BK will I be able to live without credit cards. OR, do I still need them and will charge up the debt again.

For a lot of folks w/ only cc debt, they emerge from BK in the same financial situation they were before; needing credit to meet everyday expenses.

If you are considering BK, you have to take a class before you file. Go to the BK courts website and get a list of approved agencies. This is a great place to get impartial financial advice.

Best to you Jeff,

See you around bigtime,

Tom in Colo

[jbackos]

Don't believe the rumor that Tenancy by the Entirety completely protects your house in chapter 7. Look up and read section 363 (h) of the bankruptcy code. It grants the trustee the right to sell the house if the property meets 4 conditions of law. The trustee still needs to sue your spouse for the right to sell and his court costs are often greater than $30K.

I would make a deal with the credit card company. I was allowed by one card to owe .40 of the total debt and they refinanced it for a five yer period at a reasonably monthly payment. I still ended up filing a 13 but I was able to eliminate some debt in this fashion.

Good luck

[tcreegan]

tenant by the entirety

Hi all,

Hi jackbos, you are right on 363 (h) but a husband and wife owning an ordinary home will fail conditions (1) and (2) and probably (3) Any lawyer worth his salt will be able to prevent a sale under this section.

Nice read on the BK code !!

Tom in Colo

[jbackos]

Agreed, the case must meet all four conditions according to law, but strange things happen sometimes and that is why ch. 7 is a last resort only.