Looking a Chapter 7 as a way to eliminate credit card debt, many questions...

[tobee43]

I had one CC with 0 balance go from a 2k credit line to $100. to closed within a week of filing.

yeap...that sounds about right!

[keepmine]

You really need to find out what exactly the Wa. exemption is for homes this site says $125K

http://www.thebankruptcysite.org/exemptions/washington.html

Homestead

6.13.010 - Real property or mobile home up to $125,000. If property is unimproved but intended to be occupied at time of filing bankruptcy up to $15,000. Before sale of home if the property is unoccupied or unimproved, a homestead declaration must be filed (6.15.040)

Homestead

6.13.010 - Real property or mobile home up to $125,000. If property is unimproved but intended to be occupied at time of filing bankruptcy up to $15,000. Before sale of home if the property is unoccupied or unimproved, a homestead declaration must be filed (6.15.040)

Homestead

6.13.010 - Real property or mobile home up to $125,000. If property is unimproved but intended to be occupied at time of filing bankruptcy up to $15,000. Before sale of home if the property is unoccupied or unimproved, a homestead declaration must be filed (6.15.040)

If, you can exempt $125K equity in your home, I'd stop paying cc's and use that money for living expenses and at the same time start moving cash into exempt assets.
PLan your bk. Don't rush into this-protect your assets.
I'd agree with the others. Interview more lawyers.

[ccsjoe]

Here's a summarized list of Wash. State exemptions. This is current as of July 2007 which I beleive was the last revision, I could not find updates beyond this.

Washington Bankruptcy Exemptions
Homestead $125,000*
Wearing Apparel $1,000
Furs, jewelry, and personal ornaments for any individual, private libraries
$1,500
Family pictures and keepsakes $1,500
Household goods, appliances, furniture, and home and yard equipment, $2,700
Other personal property $2,000
Motor vehicle $2,500
Cash or bank accounts $100
Two motor vehicles, farmer's equipment and tools $5,000
Professional library, office furniture, office equipment and supplies $5,000
Tools of trade $5,000

I see a problem with your cash and cash equivalent (brokerage) assets and your cars.

[tobee43]

keepinmine and joe...that was so nice of you to help out so much better than i did....

apparently washington state has a nice homestead exemptions...however, the private libary situation has me somewhat puzzled....

joking aside...i also agree with joe..i see a problem with your cash.

[DoctorPC]

What would happen if I somehow incorporated a business? I have a web site that I advertise IT services even though it hasn't made a dime. Would it be possible to then transfer the 0 bal. credit cards to the "business" as a means to keep a credit line or 2 open?

Another thought is to research settlement as a way to eliminate most of the cc debt with out having to create so much drama with a CHa 7 filing.

[DoctorPC]

Here's a summarized list of Wash. State exemptions. This is current as of July 2007 which I beleive was the last revision, I could not find updates beyond this.

Washington Bankruptcy Exemptions
Homestead $125,000*
Wearing Apparel $1,000
Furs, jewelry, and personal ornaments for any individual, private libraries
$1,500
Family pictures and keepsakes $1,500
Household goods, appliances, furniture, and home and yard equipment, $2,700
Other personal property $2,000
Motor vehicle $2,500
Cash or bank accounts $100
Two motor vehicles, farmer's equipment and tools $5,000
Professional library, office furniture, office equipment and supplies $5,000
Tools of trade $5,000

I see a problem with your cash and cash equivalent (brokerage) assets and your cars.

I was told by the former atty, that since all of the cars save one that is working, are licensed, insured, in running condition, I won't have to worry about them. They are too old and not worth much.
The rv is worth more to me than anyone else, even though it has a Kbb value of 20 K in "very good" condition, it too has a few major repairs needed, and currently cannot be moved by itself under power.
The brokerage account is another mater, I suppose by the end of the month I'll need to transfer the funds into the 401K account, at least that is what the former atty told me.

But the one question I still have is how long do I really need to wait before all these transactions need to be completed and when I can begin the cha 7 process?
Right now I'm sitting on the bench collecting information and trying to determine if it's worth the hassle. It almost seems that I should just stop paying on the credit cards I want to cancel and tell the collections people, I'm unemployed, have no income so good luck trying to collect blood from a rock... What assets could they seize if it were to come to that?

[tobee43]

What would happen if I somehow incorporated a business? I have a web site that I advertise IT services even though it hasn't made a dime. Would it be possible to then transfer the 0 bal. credit cards to the "business" as a means to keep a credit line or 2 open?

Another thought is to research settlement as a way to eliminate most of the cc debt with out having to create so much drama with a CHa 7 filing.

sounds like a possibility...and if that's the case you would not necessary have to meet the means test either.

[DoctorPC]

If they want my "professional library" they can have it, they'd be doing me and the recycle people a favor, books of software technology popular in 2000 is of little value today?

[DoctorPC]

I'll have to speak with a few more attys and see how they react to my possible scenaros. Problem is I start classes next monday so won't have a lot of time to do much interviewing maybe 1 or 2 attys a week max.

[biotechsolution]

If the brokerage account is substantial value anything about 5K your look back period could be up to 2 years. Won't do anygood setting up company to transfer to credit card to because they are still guaranteed by you, which means when you file you'll still bk on them. They'll close even if your balance is 0.
Becareful before you file..remember you can't back out of a chapter 7 filing. If they trustee sees a substantial transfer to retirement accounts they will take it.

[tobee43]

If they want my "professional library" they can have it, they'd be doing me and the recycle people a favor, books of software technology popular in 2000 is of little value today?

it's "private" library in washington apparently.....so i'm thinking your "professional" library may be s out of luck!

private may consist of nudity....u think?? what is private anyway in washington state. (i love salmon berries...only place in the us to find them is in washington!)

[ccsjoe]

Transferring assets in preparation for a CH7 filing is an absolute no-no. Not knowing the value of your brokerage account, but taking into account that 1. it must be a qualified account since you're looking to transfer into another qualified account, and 2. that you're looking to use those funds to support you for a few months, it is substantial enough that the trustee would object. Lookback period is 2 years. That's not a viable option and the attorney that advised this either knows something we don't or is plain wrong and would have cost you a pretty penny.

Do speak with other attorneys and get a sense.

[IBroke]

You and I are in same boat. I was trying to carry 3 zero balance credit lines (2 cc's, 1 loc). The loc already slammed door shut. The two cc's remain. We'll see, but not really hoping at all.

It will be very interesting to see how New Millennium Bank is going to react. That is my secured card. On the one hand, they certainly would like to slam the door on a BK-filer, too, but on the other hand, they might prefer keeping the security deposit under their roof..

[ccsjoe]

sounds like a possibility...and if that's the case you would not necessary have to meet the means test either.

Tobee, I think I disagree here. 1. He is personally liable for the cc's, 2. he is looking at only transferring the 0 balance cc's in order to try and keep them open, 3. because of personal liability they would likely be closed, and 4. his debts are primarily consumer, so he would have to pass the means test. On top of that, even if he were to transfer the debt to S-Corp or other Corp, it would be well within the lookback period and certainly objectable by the trustee.

[tobee43]

let me clarify something....if you have an existing business one may be able to incorporated it into ones bk......if for example it was a LLC or sole prop..or subchapter s corp...those are personal guarantees and most can be done in a bk....

depending on if you already have the business it could work...but you cannot formulate a "new" business now...unless you want to wait a few years to file. i think i misunderstood, i thought you had a business on the "side".