If credit card company gets judgement against home in Fl. - What if it is foreclosed

[catleg]

I believe the rule is that a judgment that impairs a bankruptcy exemption can be voided. I'm not sure what the import of the exemption is. I don't believe it means that a judgment would survive in a zero equity situation. Rather, I think it means in a place like NJ with just the federal BK exemptions, if your equity exceeds 20k (approx) or 40k for a married couple, if you had liens piled above that they wouldn't be voidable. (technically the term is avoided/avoidable but I find that confusing).

[hereforinfo]

Florida is not a deed of trust state or a community property state. To be on the safe side we will put her monies in my son or daughter's bank account.
I may be screwing up, but I do not plan to use an attorney. I am just shedding assets so nothing will be there for the creditors to get. In Florida, the homestead is considered community property.

Umm, if you are planning to file bankruptcy I would recommend NOT doing that.

[hereforinfo]

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My wife is on the mortgage 1st and 2nd both which are owned by bank of america. But she is not on any credit card debts. Could BofA come after her bank account or garnish her wages for the 2nd mortgage? Does giving back the house eliminate that possibility since the 2nd mortgage was secured by the property? BTW my income is pension and she could retire anytime.

Thanks

Yes, actually in Florida the 1st and 2nd could both get a deficiency judgement. In reality, the banks haven't been doing this and typically write off or forgive the debt and send you a 1099. In that case the forgiven amount becomes taxable income and you would potentially have to pay income taxes on some or all of it (depending on whether it was your primary residence and what any cash out or heloc funds were spent on).

Even if they decide to come after you for the balance, they would have to go to court and get a judgement before they could ever garnish her wages.

[Martha31]

Well to be honest with you these schemes always backfire, they are NOT true asset protection and you are clearly hiding money in an attempt to keep creditors from knowing about it and that is illegal, its called fraudulent conveyance or fraudulent transfers.

I don't know what you want to do but what ever it is you are doing without the advice of an attorney. Your inexperience in this area may cost you dearly. All it would take is one lawsuit, one judgment and a debtors exam to undo everything you think you are doing to try 'shedding assets'.

Point is, people don't 'hide' money in their kids (and I am sure they are adult children?) accounts for any reason but to defraud creditors. And that is what gets you in trouble. Plus if you later do end up filing for BK this type of transaction will make it so YOU CANNOT file BK for at least a year or more.

You should take the time to learn the line between protecting your assets and what can end up being a fraudulent transfer.

Not only would a judge in a civil case undo these transfers they would be compelled to go on a big hidden asset search, and if you get caught lying to the court, well that can result in sanctions or jail time. Then if you later decide to file BK the trustee has even more power to look back and if you made these transfers and lie to the BK court, you do get Federal jail time. It is very difficult to explain to a trustee why you put money in your kids bank accounts for any reason other than in an attempt to defraud creditors. If you lie and don't report it (I don't remember how long the jail sentence is, I think it is five years.) you can end up with jail time.

Anyways, if you don't believe me here is some info

http://www.rpifs.com/protection/apfraud.htm

That is very good advice and information that I was not aware of until now.
I am doing this before any lawsuits. The lawsuits should commence in about 3 to 4 months. I borrowed money from my insurance policies to keep afloat for the past few months. I think I will have my wife's savings pay back those loans and start paying all bills (leaving my pension money in the bank) which would render her judgement proof as well. My wife should not come into the picture except with the foreclosure process because all of the credit card debt was incurred by me and in my name only. Also, what is a debtors exam?

Thanks much.

[floridian]

im probably a day late with this, but my lawyer told me any transfers within a year could be considered fraud...

[Martha31]

Debtor is screwed

looks like the debtor is screwed in several ways.

[catleg]

Just remember the rules and know how to use them to your advantage.
Let's say you have an item of value, say, a motorcycle, and a friend willing to help protect it.
You can't just give him the motorcycle. That's an avoidable transfer.
You can sell it to him for fair value, then use the proceeds for your living expenses or really whatever you want, a vacation if you like, more likely food or medical care.
You could also borrow the fair value, "miss" a payment, and let him repo the bike. BB can probably suggest the best way to make this happen.
Then to make things really special, he "auctions" the bike to friend #3 and garnishes your wages for the deficiency. I'd like to see Mr Ricke figure that one out.

Until you are actually in BK they can't control how you spend cash, and you'll be fine in BK so long as you receive equal value in return for what you spend.

[Martha31]

Until you are actually in BK they can't control how you spend cash, and you'll be fine in BK so long as you receive equal value in return for what you spend.

Or receive fair value for what I sell as well?

[Martha31]

If you go read the link I posed in civil actions some transfers going back three years can be looked at.

In a BK setting the trustee can go back as far as they want for the most part.

The whole question lies on and is based on, when you knew you were in financial trouble.

As for a debtor exam, google it you will get more from the Wiki than I can type here.

The whole question lies on and is based on, when you knew you were in financial trouble.
What would be the trigger point of knowing you are in financial trouble?

[catleg]

The whole question lies on and is based on, when you knew you were in financial trouble.
What would be the trigger point of knowing you are in financial trouble?

Typically, in a non BK situation, this means when a court issues a judgment against you, and you become aware of it. The court doesn't care if you stiff creditors, but they start to get interested when you circumvent the will of the court.

[catleg]

Until you are actually in BK they can't control how you spend cash, and you'll be fine in BK so long as you receive equal value in return for what you spend.

Or receive fair value for what I sell as well?

Yes, whoever receives your goods or money needs to be able to claim this as a defense if the court tries to "undo" the transaction.

[Guest]

I filed bk in 2005 & I had a 1997 jeep grand chrk easily worth $4,500 & transfered title to friend in different town, only 2 months before filed bk, told bk court that it had engine issues etc & that I sold it for 1000 ( which is all cash your allowed to keep if it was sold) & said I used that to pay lawyer. I never had a issue with bk court.

[hereforinfo]

I filed bk in 2005 & I had a 1997 jeep grand chrk easily worth $4,500 & transfered title to friend in different town, only 2 months before filed bk, told bk court that it had engine issues etc & that I sold it for 1000 ( which is all cash your allowed to keep if it was sold) & said I used that to pay lawyer. I never had a issue with bk court.

Wow. Bragging about getting away with fraud? That's something.