Experts whats your opinion; would this raise suspicion?

[lvmcse]

First of all, my life has been a complete hell. 3 years ago, lost my job and had to take a job in another state. Son refused to leave state. Therefore I supported his lifestyle there while I relocated for the job. We rented out the house only to have the tenants thrash the place. Unable to repair due to lack of cash on hand. House lost 6 months ago. :-(

I am thinking I filing BK. Like everyone here, I'm scard and don't know if I should proceed. Here's the situation. Heavy in credit card debt. When I relocate for the job I had 0 debt and only 2 credit cards. Over the past the 2 years I have opened 6 other credit cards. My debt now stands at 60,000. I was using the cc to pay bills at home, son's education/support and so on. No luxury purchases. Just day to day expenses. I did take out 7000.00 cash from a cc to pay from home expenses in LV while it was rented out.

As it stands now, I have 300 in checking account and all my cards are max out. I have no money and had to borrow money to buy lunch today. Would like to file BK but don't know. What do you guys think?

[justbroke]

I consolidated your question since you asked this same exact question, with same exact post, in two different threads in two different sub-forum areas. It's best to keep it all in one place so that following the questions/answers is much easier; besides, it's a forum rule to not create duplicate threads. Now that the housekeeping is out of the way...

I think you may be a good candidate to start bankruptcy pre-planning. Everyone makes some financial mistakes and sometimes it is just too overwhelming. Unfortunately we usually realize, too late, that we've been supporting our lifestyle or situation with credit cards! Next thing you know, you have $60K of unsecured credit card debt.

My first question is how much of that credit card debt was used to pay for the son's school? Just wondering because it's technically non-dischargeable. As for the rest of the debt, it should go away nicely. When you were foreclosed upon, did it generate any "deficiency" judgment? if so, how much was that? (Noting that generally, California first mortgages are non-recourse, but could become recourse loans if you refinanced.)

Other questions... how long ago was the cash advance?

Things to do now... if you are paying your unsecured credit cards STOP NOW. Stop using them as well. You should start lining up some attorneys to consult with. You need to get your financial house in order.

[ValleYum]

You also started this thread - and never came back to those who tried to help you but needed more info...

http://www.bkforum.com/showthread.php?77320-Need-Help-from-the-experts-DO-I-qualify-for-Chaper-7

I know you are scared and broke and tired and nervous but please try to respond back otherwise the folks on here can't really help you.

Hang in there and start making appointments to see see BK attorneys for free consults as JB advised above.

[AngelinaCat]

I also asked how long you have been in California, or if California is your home state? If it isn't your home state, what is and how long were you there? Answers here will determine which state's exemptions you will use, or whether you will use Federal exemption.

Your other post that I responded to before it disappeared, suggested that you had been supporting an adult son in lifestyle that he was not willing to give up. I suggested that it was time now for the son to learn to live on his own, and that you needed to do what you had to do to take care of your self and your spouse, if you have one. You can give, and give, and give, but unless you take care of and feed yourself, you will run out of anything to give anyone, and that includes you and your spouse.

[lvmcse]

Hi Just Broke: over the 2 years, re son's college; probably 4,000 on 3 different cards. The last one was for 848.00 8 months ago. I havent recieved a 1099 for the house yet. People are telling me that since it was our primary from 2005 to mid summer of 2009 that we should be forgiven under the debt forgiveness act. Thank you for responding.

[lvmcse]

Hi Angelinacat: We been in California since 2009. Regarding son. First I don't know how parents do it with more than 1 child. This adult son assisted in crushing my credit and savings. But also the high cost of Cali also help. He is better for the last 7 months. He is working full time but I find myself giving him $$$ sometimes to help. This is a positive step but it does not solve my problems. I understand that I need to take care of myself/wife first. But as a parent, no matter how old your child is, your still a parent.

[justbroke]

Hi Just Broke: over the 2 years, re son's college; probably 4,000 on 3 different cards. The last one was for 848.00 8 months ago. I havent recieved a 1099 for the house yet. People are telling me that since it was our primary from 2005 to mid summer of 2009 that we should be forgiven under the debt forgiveness act. Thank you for responding.

The debt forgiveness act is about taxation on any gain you may have from the debt being forgiven. If the debt isn't forgiven, then the special tax issues doesn't arise -- especially if the loan was non-recourse. I'll just assume that the loan was non-recourse and that it is now gone. You may still receive a 1099-A and/or 1099-C.

As for discharging the school debt, it will depend on how astute the credit card companies are when you file. Some of them may not notice that you used the cards to pay for school.

When did you do the cash advances?

[lvmcse]

Cash advances were well over a year. Made 1 in Feb of 2011 for 7,000. In Feb of 2012 I stop paying the card since the minium payment was over $600 a month

[AngelinaCat]

Actually, if you have been paying the son's college tuition/expenses on the credit cards that might have been a smart way to go... Student loans are becoming really bad news....

[justbroke]

I don't think the cash advance(s) will be an issue, although that doesn't stop the creditor from bothering your attorney by "threatening" that they'll file an adversary (complaint) in the bankruptcy. Of course, you review all this with your attorney.

As Mrs. 'Cat writes, the student debt on credit cards may be a good thing. It is possible that they don't pursue dischargeability for that debt. I believe that the (credit card) creditor(s) would need to start an adversary (complaint) in order to have that portion of your credit card debt non-dischargeable.

[lvmcse]

I don't think the cash advance(s) will be an issue, although that doesn't stop the creditor from bothering your attorney by "threatening" that they'll file an adversary (complaint) in the bankruptcy. Of course, you review all this with your attorney.

As Mrs. 'Cat writes, the student debt on credit cards may be a good thing. It is possible that they don't pursue dischargeability for that debt. I believe that the (credit card) creditor(s) would need to start an adversary (complaint) in order to have that portion of your credit card debt non-dischargeable.

Do they settle on the amount or they firm?

[justbroke]

Do they settle on the amount or they firm?

In all cases, creditors settle adversary proceedings (APs) over litigating. However I don't see any reason why they'd win their case anyhow, since the time from the cash advance is over a year. As for student loan debt, I don't know, but they would probably also settle.

You would need to talk to an attorney over the likelihood of a creditor winning an AP given your specific circumstances.

[pamkev]

Hi Angelinacat: We been in California since 2009. Regarding son. First I don't know how parents do it with more than 1 child. This adult son assisted in crushing my credit and savings. But also the high cost of Cali also help. He is better for the last 7 months. He is working full time but I find myself giving him $$$ sometimes to help. This is a positive step but it does not solve my problems. I understand that I need to take care of myself/wife first. But as a parent, no matter how old your child is, your still a parent.

Amen to that, between my daughter and son they were killing us. The son not so much as of now but has in the past which like you also assisted in crushing our debts and really wiped out our savings. Then it just snow balled from there lack of hubbys work, medical issues, etc just never recovered and should have filed years ago. Pam

[lvmcse]

In all cases, creditors settle adversary proceedings (APs) over litigating. However I don't see any reason why they'd win their case anyhow, since the time from the cash advance is over a year. As for student loan debt, I don't know, but they would probably also settle.

You would need to talk to an attorney over the likelihood of a creditor winning an AP given your specific circumstances.

Thank you for your imput. Also when we moved back we had about 35,000 in our account. Over time the last 2 years got destroyed by paying bills, son's expenses and I spending more than I should. I was taking out the wife to restaurants that were pretty expensive. I will trying to rebuilt our marriage since she to was depressed over leaving her home and having tenants in them. Do you think this will come up? Just talking about this is stressul.

[justbroke]

I don't think it will come up. In bankruptcy, time seems to heal everything. The longer it has been, the more things are not so bad. It's just a fact of the process. Many people have come down a similar path as you. They have had tens of thousands in the bank (liquid), nice 401K, and tens of thousands in available revolving credit. Then something happens and we believe that we can just "get by" for a "little while" on the credit and savings. After the "little while" (several months) go by, we then start to get desperate and withdrawing fro the 401K. Next thing you know, maybe 12 months later, you realize that this is never going to work!

That's the reality of it. It just is what it is at this point. You just start bankruptcy pre-planning at this point and relax in knowing that a fresh start could be as close as 6 months from filing a Chapter 7. Even if you end up in a Chapter 13, you can relax in knowing that the hounding creditor calls and "threats" of lawsuits, and actual lawsuits, are stopped (stayed).