your feedback appreciated

[AngelinaCatHub]

All your response led me to ask another question here. Do I need to shut down the operation first and then file bk? But, this means that we will have a job at the time of filing. I was told that we should not be earning more than our living expense. Otherwise, trustee will take it from us. Any ideas and advise are greatly appreciated.

What you make in your business gross is not what pays your personal bills. You must keep working as long as you can and you are not bk yet, so save a bit for my above post idea if feasible. It is your means test determining your bk eligibility. Take one online free. As you have indicated, you are on borrowed time. 'Hub

[backtoschool]

I have pondered your situation and all the responses, which are very good.

Without going into some sort of Fraud, and I wish to be corrected by my peers if wrong (please), I would work out the paid inventory, if your business is a corporation or LLC, and file BK for the business.

You have a paid for house in another state. Jobs are almost non existent. I'm speaking for myself right now, there is no debtor's prison. Leave for your home state, sell your house to your renter for what you can get. Purchase a paid for camper that you could get a start in, some cheap FL or TX land that you could park a camper on (watch codes) and sign a domicile affidavit (it usually takes six months to achieve). Do what you are able to do to get living money if you have not made enough on the house sale.

Make sure you take nothing that is not yours, out of the business. Notify all that you are insolvent and cannot pay them; you WILL be sued. Attempt to live out six months without Judgment action, and file bk in FL or TX as they cannot take your home in those "Homestead" states.

This is a fine line of skipping and I do not approve of this action, but you have not filed yet, and lived six months without credit. Use your own asset of the house. It is all you have. A Judgment can take it, and bk can take it. Use your own money for a new start. Until and as long as you haven't filed, you are free to do what you wish, if you do not defraud anyone (besides your inability to pay). Make no new bills or commitments. Live out your stock and use that pittance to attempt to bail out. If you have employees, MAKE SURE they are all paid in full and make sure you pay their taxes. Do nothing that can be construed as illegal.

Now understand, I do not approve, but I am thinking what I would be forced to do in your situation. You are running 90 miles an hour down a dead end street and will soon meet the end.

Any others, pro or con regarding this post, please chime in, I won't be offended. 'Hub

Hi Hub. Although you can file after six months in TX or FL, I think the look back period for using the homestead exemption is 2 years, or the previous state of residency's exemptions apply.

I agree with you that the OP's house is the only real asset at this point. No new inventory should be purchased if it cannot be paid for with cash.

I think the OP's vendors will probably sue pretty quickly when not paid, so six months is probably the max the OP has before they will have to file in my opinion.

[AngelinaCatHub]

Hi Hub. Although you can file after six months in TX or FL, I think the look back period for using the homestead exemption is 2 years, or the previous state of residency's exemptions apply.

I agree with you that the OP's house is the only real asset at this point. No new inventory should be purchased if it cannot be paid for with cash.

I think the OP's vendors will probably sue pretty quickly when not paid, so six months is probably the max the OP has before they will have to file in my opinion.

And too, I agree with you. I am not sure about the lookback but I shall find out and add that to my mental notes. I see in this OP's case, a hopeless mess in that eventually they may wind up with nothing, nadda. Even if they have to go to the MA rules or NY rules (wherever they are legal residents now) and get a BUNCH of Judgments, if they can redeem some of their property (legally) before they bk, and move to a warmer, cheaper place, in two years, perhaps those Judgments can be set aside. I quarter acre lot and a camper is less likely to be attached particularly out of state as the Judgments will be in NY and address into FL once the creditor finds them (and they will). But if they are noncollectable, at least they have a bit of cash and a place not quite under a bridge. The camper can be turned into real property in FL if the wheels are removed, and an RP tag is purchased (a one time fee) but cannot be put back onto the road.

I have lived in my young years in much more poverty than I am describing. I only see hope in this scenario (if all things have been revealed) to use the house asset before it is taken by Judgment.

B2S, you have it pretty together, can you think of something better? I'm now interested. 'Hub

[ladycee]

Hi,

I am pretty new, but just want to post my .02. My atty did tell me that I could keep ONE cc, but it would entail that the card have a zero balance and an application for permission to do so to the bk court. There also would be no guarantee that the card you choose to keep would be willing, I believe you can discuss with the cc company before you bk...???? Also Florida has a pretty "lean" homestead exemption from what I have noticed on this forum.

Sounds like really good advice about the camper and small cheap plot of land....this would be easier to do before bk, as it might be difficult to purchase "anything" after the bk.

So, yea put all your ducks in a row before you bk, and try not to let it last longer than 6 mos.

Chrisw

[AngelinaCatHub]

Hi,

I am pretty new, but just want to post my .02. My atty did tell me that I could keep ONE cc, but it would entail that the card have a zero balance and an application for permission to do so to the bk court. There also would be no guarantee that the card you choose to keep would be willing, I believe you can discuss with the cc company before you bk...???? Also Florida has a pretty "lean" homestead exemption from what I have noticed on this forum.

Sounds like really good advice about the camper and small cheap plot of land....this would be easier to do before bk, as it might be difficult to purchase "anything" after the bk.

So, yea put all your ducks in a row before you bk, and try not to let it last longer than 6 mos.

Chrisw

Yes FL and TX are about the same. First, heating bills and weatherization is minimal. There is no State Income Tax in either state. The home cannot be levied upon for any reason if it is your domicile. There is a 50k value homestead exemption in advalorum taxes. If you are fairly inland, it is cheaper to live. You can visit the Gulf of Mexico and the Atlantic ocean in half a day. The weather is nice except when an occasional hurricane comes about. They can be fun though if you get drunk enough. LOL. 'Hub

[backtoschool]

Zero balance cards do not have to be put in the petition, but there is a very high chance that they will be closed right after filing, especially in a bk like the OP's where there is a large amount of debt both secured and unsecured.

[backtoschool]

And too, I agree with you. I am not sure about the lookback but I shall find out and add that to my mental notes. I see in this OP's case, a hopeless mess in that eventually they may wind up with nothing, nadda. Even if they have to go to the MA rules or NY rules (wherever they are legal residents now) and get a BUNCH of Judgments, if they can redeem some of their property (legally) before they bk, and move to a warmer, cheaper place, in two years, perhaps those Judgments can be set aside. I quarter acre lot and a camper is less likely to be attached particularly out of state as the Judgments will be in NY and address into FL once the creditor finds them (and they will). But if they are noncollectable, at least they have a bit of cash and a place not quite under a bridge. The camper can be turned into real property in FL if the wheels are removed, and an RP tag is purchased (a one time fee) but cannot be put back onto the road.

I have lived in my young years in much more poverty than I am describing. I only see hope in this scenario (if all things have been revealed) to use the house asset before it is taken by Judgment.

B2S, you have it pretty together, can you think of something better? I'm now interested. 'Hub

I think moving to a cheaper, warmer place is definitely a good idea. I think the OP has to close the business pretty much immediately since the inventory is being paid for with credit, and the OP needs to use cash to live on as opposed to buy inventory. As to the trailer, I am not sure that that would be a good bet versus renting. Renting would leave the OP with no assets to attach, which is better in my opinion.

Money should not be put in bank accounts until the OP files, since the accounts will get a levy put on them when the creditors start to sue. Prepaid debit cards can be used to pay for things, and are difficult/impossible for creditors to attach levies to.

I think that the OP may have to file before six months, but absolutely must wait 90 days minimum.

[AngelinaCatHub]

I think moving to a cheaper, warmer place is definitely a good idea. I think the OP has to close the business pretty much immediately since the inventory is being paid for with credit, and the OP needs to use cash to live on as opposed to buy inventory. As to the trailer, I am not sure that that would be a good bet versus renting. Renting would leave the OP with no assets to attach, which is better in my opinion.

Money should not be put in bank accounts until the OP files, since the accounts will get a levy put on them when the creditors start to sue. Prepaid debit cards can be used to pay for things, and are difficult/impossible for creditors to attach levies to.

I think that the OP may have to file before six months, but absolutely must wait 90 days minimum.

Thank you for following me up. Of course living in an Income Tax free and WARM state sure beats Chicago. (I lived there eight years). Perhaps renting, I was just thinking of a paid plot of land and a paid for bitsy apartment would be cheaper. Rent is still not cheap but the OP can go to Craigs list in a city where they would like in FL, let's say, like St. Aug, and get an idea of rentals here. I would also keep the cash out of a bank or in some exempt type of document redeemable later. I am sure they will be sued once the creditors get wind of any forthcoming bk if they catch wind of it.

Even if they cannot wait the 90 days, it is explainable about the CC use as it is for business and a worthy attempt to pull out of their situation and not for an extravagance like an LCD TV or gambling. With all that we did wrong, they would likely satisfy the Trustee with what was used but they MUST stop immediately from using them like RIGHT NOW!

I would like to know what franchise they have and if it is under as described, it is only a matter of time before they my end up in a forced bk. 'Hub

[CJD]

I will not knowingly do any fradulant activities. I wish I could pay them all, but I can't. I took a risk to start my own business, which did not take off as I expected.

My house is a collateral for my loan. So, it will be taken. Even if I sell it beforehand, I need to get a permission from my creditor to do so. There will be nothing left for me.

I have been meeting all the payroll and sales tax is paid off so far. We have been thinking hard what to do after filing.

Anyway, thanks for your insight, AngelinaCatHub!

[CJD]

Oh, I failed to see all the postings, thanks, everyone!!

Since now I know how it is to live in a high tax state like NY, I was telling my husband, I like to move to a state like TX with no income tax and cheap house, etc... But, moving costs will be tremendous...

[AngelinaCatHub]

Oh, I failed to see all the postings, thanks, everyone!!

Since now I know how it is to live in a high tax state like NY, I was telling my husband, I like to move to a state like TX with no income tax and cheap house, etc... But, moving costs will be tremendous...

That depends on what you intend to move. You need a new start, sell all that you absolutely do not need as the money is more important. Selling the house is not an issue, it has to be done. You see, it is not a paid for house if you pledged it as collateral. It is now a mortgaged house. If you can sell it, pay the note off, and get something, better than nothing.

If you rent, find a place either furnished or furnish it as we did, with an apartment we had for a year on a job. From the dumpsters. College cities are great for good stuff and I cannot tell you how many 30" TV's and microwave ovens we just pick up on the side of the road on garbage pick up day. I donate them to nursing homes. All that kind of stuff usually works and is tossed for the LCD screens. 'Hub