Judgement Questions, please answer if you know!

[nsupanda]

I'm new to collections, as a matter of fact, so new that I haven't experienced it yet. Last month was my last month paying on my credit cards. I'm devoting a whole year to pay off my husband's two cards so that when I file bankruptcy he will not be affected (well, hopefully not affected).

Anyway, this month I will start paying down his cards and not paying anything on mine for a whole 12 months. I have a few questions that I hope you guys can answer for me if I get sued:

1) Will I have to appear in a court close to THEM or will I have to appear in court close to ME, or do I have to appear in a court at all? I've never been to court so I'm really stupid when it comes to that.

2) I know they can garnish my wages, but can they levy my bank accounts? Would it be in my best interest to close my bank accounts and only have one opened for my husband in case this happens?

3) If they sued me, can I file bankruptcy before the judgement happens in order to avoid any attemts of garnishments or judgements?

Thanks for all your help, I'm at my wits end and I'm just trying to do whats best for me and my family. I really feel that if I can pay off my husband's small debts first we can salvage some of our credit and not all of it. Besides that, he is unwilling to help me file bankruptcy so I figure this is my only option. In 12 months I will be able to file chapter 13 and get my life back in order... such a relief!!!

[catleg]

They have to sue in your county court, if it gets to that. You don't have to appear if you don't plan to fight it. You can often slow things down quite a bit if you do fight, however.

They usually can levy bank accounts. But if you use an out of state bank and cover your tracks it can be really hard for them to find.

Yes you can file BK and the court cases automatically stop at that point. Or if they get a judgment it can be vacated in most cases, as long as you have no equity or minimal equity in your home.

You're not in a community property state are you? In that case debts incurred during the marriage are joint debts.

If you state has tenancy by entireties then even if they get a judgment against your individual debt it can't become a lien against your jointly titled home in most cases.

In practical terms wage garnishment is the only method to collect a judgment that's reliable as long as you're working.

In my experience credit card lawsuits are often based on identifying whether you have property (so they can get a lien) but considering the current realities that strategy is so old-school.

[nsupanda]

I'm not sure about Oklahoma, wheter it's what you referred to or not. The good thing about me is that I do not own my home, I rent-to-own from my mother (basically, I will own it after 20 years). If it comes down to it, they can garnish my wages, but I don't want them messing with my bank account, that's just crossing the line!

So, you think more than likely they'll just garnish my wages? If that happens, I think I will just go ahead and file bankruptcy even if my husband's debt is not paid off yet.

In your honest opinion, and this is hard to answer I know, what do you think the chances of them taking me to court in 12 months time are? Probably good since I have a steady job, huh? What if I paid each credit card, oh say $10 a month? Do you think that would prolong them from taking legal action?

[BKDefender]

If you're not paying the minimum amount due then you're still in default and I don't know that I would expect the company to delay filing a lawsuit against you. I don't believe that Oklahoma is a community property state, so whether a lawsuit against you would affect your husband is a state law issue. I can tell you that in Nevada if any debt is incurred that benefits the community (i.e. the couple) then the debt is owed by both spouses regardless of whose name is on the debt and whose credit was used to get it. i.e. if a husband gets a credit card to take his mistress to Cancun it's not a community debt, but if he uses the credit card to buy groceries or pay utility bills then it's a community debt.

The real question is - if you file bankruptcy individually will your husband become liable for any of your discharged debts? In Nevada Yes almost 100%. I don't know about Oklahoma though. If he will become liable for your debts, or if they can take property under his name only to satisfy your debts, then I don't see how your strategy will work. But if they can't execute against a bank account in his name, or can't garnish his wages to pay your debts, then your strategy might work.

Good luck,
--William

[nsupanda]

I spoke to an attorney before about filing bankruptcy only on myself and he never mentioned anything that my husband would become responsible on debts that were not joint. I hope that is the case.

[nsupanda]

I don't know how credible this website is, but Oklahoma is not listed as a Community Property State:

http://www.creditwrench.com/communitypropertystates.html

[catleg]

A lot depends on whatever cost vs benefits model the creditor uses when deciding to "go legal" in your state. I can tell you that they will make it very uncomfortable for you. I am in NJ, which is a very creditor friendly, low cost, easy to sue state. I got sued 9 times (well, including my wife) starting at about 5 months out and still going strong by the time I filed ch13 about a year later. My wife caught most of the suits since the house is titled in her name alone. Chase was the first, probably since they maintain in-house counsel in the biggest states where they operate (NJ, NY, FL, IL, CA). Also got a bunch from Citi, one lawsuit per account, and a few others from random cards like Discover and GE Money Bank. They never succeeded in getting a penny out of us though.

Your case is particularly interesting because you're planning to pay your husband's cards while stiffing your own. Boy they're gonna hate that.
The court will see that as a preferential payment to other unsecured creditors but it should not hurt you one bit...all they can do is try and claw back those payments from those credit cards for the benefit of your bankruptcy estate...good luck with that! It reminds me of the bankruptcy trustees asking debtors if they have any FDCPA claims against collection agencies. Talk about taking out of one pocket putting it in another!

I would encourage you to speak to a local attorney (or a few) just to make sure it's going to work out as you hope it will. It's a big brave step you're taking and I wish you had your husband's buy in on this. It is really stressful getting collector calls all day, having them call your neighbors, relatives, and having papers served by the sheriff. I went through all of this for a year, and the peace of BK is so much better. It was very tough on our marriage, but we're much better (though not quite perfect) now.

[nsupanda]

Oh, thank you so much for your story. I decided that I would just tell my husband that he has no option to help me with the bankruptcy. I thought about it and I just can't go through that for a whole year. The worry and the calls would just eat me alive. He finally agreed to go see a lawyer about both of us filing together, although he is not a happy camper. He agrees that he contributed to our debt, but he wants to salvage part of our credit if possible and his is better now anyway. But, it looks like we're both going to file together now which is a big relief for me.

Now I'm just getting uneasy about the whole bankruptcy process. I called the lawyer today to see what all I needed to bring in and it's a huge long list. My biggest worry is that my payment plan will be too much and we won't be able to afford it. I hope it all works out for me though, because I can't take this worry and stress any longer. Its good to hear stories like yours because it gives me hope that things will get better!

[scsurfer]

I don't know how credible this website is, but Oklahoma is not listed as a Community Property State:

http://www.creditwrench.com/communit...rtystates.html

Caution, firefox reported that page you linked to as an attack page (spam) and wouldn't let me open it.

[optimistic1]

The real question is - if you file bankruptcy individually will your husband become liable for any of your discharged debts? In Nevada Yes almost 100%
Good luck,
--William

[BKDefender]

524(a)(3) only protects the non-filing spouse's interest in community property obtained after the filing of the other spouse's bankruptcy. It does not protect the husband from having to pay out of non-community assets that are under his name only as sole and separate property (including inheritance and gifts from his family/friends.)

They can't force him to pay out of his community wages or other community property, but if he has property that is under his name only as his sole and separate property, then they can force him to pay from that. (which is what I meant 'under his name only' - I probably could have been a bit more clear on that.)

--William

[BKDefender]

btw, this particular problem pops up and causes havoc in divorce cases. i.e. community debts are assigned to husband and wife and the divorce decree has an indemnification clause in it. Then one spouse files BK which discharges personal liability to the creditors. All of a sudden the indemnification clause kicks in and the BK filing spouse now owes those same debts to the non-filing spouse because the non-filing spouse now is responsible directly to the creditors for that debt.

--William

[optimistic1]

That is so interesting, when family and bk law mingle, it gets very complicated, I have never heard of indemnification clauses, I will have to research that.