Confused about Texas Exemptions

[Pizza]

In reading all the articles here and elsewhere, I have been under the impression that most BK filers do not lose any personal property unless it's large, such as boats, RVs, etc. and that Texas is very BK friendly.

But what I don't understand is the personal property exemption. Some places I see a straight $30,000/$60,000 limit on all personal property, elsewhere it is categorized into specific sets of items.

I'm really curious as to the meaning of "household furnishings". What does that mean, really? Are any appliances exempt? Can the trustee really take the refrigerator, (built-in) dishwasher or other such appliances? I'm very nervous and if anyone can help I would be very appreciative. Thanks.

[whipster1]

Unless you have diamond-encrusted appliances, you are fine. Household items are just what you think they are. I suggest you get a PACER account and look at a few filings...some are real detaled some just say "furnishings". Remember the value is not new value, but liquidation value as if you had a garage sale: everything must go today...same with clothing.

[Pizza]

Nope. No diamonds here.

All of this research has been very confusing. I made it for another year without getting behind, but the bills have finally caught up. I've got Chase and Citigroup calling nonstop, so it's coming soon. I can afford the minimums on most of my cards to keep them at bay, but a couple of them dropped my credit line below the balance and sent crazy minumum payments and it's evident that I'm about beat.

I'll be talking to an attorney soon, with some help he can clear all this up. In Texas you can pick state or federal exemptions, so at least I have options.

[LuciluS]

IF you know you will be filing BK in the next year, Stop using your Credit Cards and Quit Paying Them unless: You've had a Balance Transfer within the last 90 days, large purchases over $600 or Cash Advances.

We stopped paying all of our credit cards late last Sept. execept for one as I had a Balance Transfer of $3,500 in Aug. Our BK Attorney told me to pay that one credit card the min. mthly pymnt & try to add addt'l monies each month. I paid the $25.00 extra for 3 mths & then stopped paying.

Most of our credit cards are in the hands of collection agencies. The credit card cos. & a few of the collection agencies have been notified we are filing a Chapter 7, know our Attorney's, name, address & Phone #.

I guess we haven't been sued as I beleive they have the means to find out if you have any Assets or large cash transactions and we haven't/don't. In fact, we volunarily surrendered our motorhome last Nov. as we could not afford the monthly insurance payment. They picked it up late Nov. & sold it at an auction in Dec. We received a letter notifying of the auction & then another letter stating the deficiency amount we owe which we will include when we file our Chapter 7 on 9/30/09.

At the advice of our Attorney, I know longer answer the telephone unless I know who is calling. We have received quite a few collection agency form letters, but, knock on wood, nothing stating they are going to sue us.

Our Attorney told us if a suit was filed before our BK, he would file a motion for delay until we could get our BK filed. Please stop paying Now especially if you haven't charged. You are wasting precious money which could be used to help pay the Attorney.

Luci

[Pizza]

[LuciluS]

Thank you LuciluS for all of the insight.

I'm not using any credit cards, period, for anything. I gave up and went straight to cash right after the big hits from Chase and Citibank. Now it's the waiting game. I'm not answering the calls, and all communication will be written only using the correct standards I've researched (just to keep the creditors and myself spinning our wheels as long as possible).

I'm not in a big rush to start the process, just hoping to convince the creditors that legal action would be a waste of time - Texas has no garnishment, most if not all property can be exempted using one exemption scheme or the other, and if that's not enough, I have the BK-bomb on the side burner.

I'm paying the 'small' payments to other creditors (mainly out of good faith) until I do see an attorney. No sense in adding more potential litigation over $20, right?

If you are not paying some of the Credit Cards then don't pay Any of Them. $20 here and there adds up quickly. Unless these are local store credt cards I wouldn't be paying any of them.

Yes, I had some Credit Cards with less than $1,000 balances and payments were $20 - $25 for the minimum, but our BK Attorney said to us that we were not accomplishing anything except throwing our money out the door. Because, when you file BK all credit cards or Any Debt must be listed on your Creditor Matrix. And once you file BK, all credit card companies will close your account.

I use my debit card which pulls the money immediately out of our checking account and I also pay all of other bills: house payment, truck payment, utilities, etc. from Bill Pay. My Social Security Disability check is auto debited into our checking account and our monthly auto insurance is too.

If you are planning on filing BK this year, I wouldn't be paying any Credit Card Debt at all. Just a suggestion - final decision is yours to make

Luci

[Pizza]

I know there has been some here & there credit card activity within the last 90 days (no big ones, just gas/grocery-type transactions), so rather than take a chance with every credit card, I might be better off just waiting until the 90-day mark and see what happens.

My big concern I guess is that while it's easy to show the inability to make big payments, claiming to be unable to pay a few bucks here and there might raise some eyebrows. That and I have to see an attorney at the right time to see how the exemptions work, plus the higher risk of litigation and all the phone calls.

Often in Texas, creditors don't pursue debtors because virtually every case is non-asset. But I could see the odds increasing with the number of angry creditors (esp. Capital One and Wells Fargo). So I just take it day by day. I haven't gotten any letters from the creditors I stopped paying, but a LOT of phone calls, so really I'm just buying time. I'm ignoring (call blocking when possible) the calls and wait for letters to come so I can judge my next step.

Your advice is very appreciated. Sometimes I feel like my posts are largely ignored, maybe because the question is too tough to answer or because I lack in eloquence. Texas exemptions are kind of tricky because of the wording while collections are tough on the creditor. It's really a see-saw game of should I/shouldn't I file and if so, when? (My when would probably be the first concrete threat of litigation).

Oh, yeah, and I don't use my bank account anymore .. I use cash and money orders. I don't want a paper trail and plus creditors can't easily freeze accounts in TX.

[LuciluS]

Gotcha! I understand, now. Yes, I would want to try to put at least 90 days inbetween purchasing and not paying. I guess you are getting a Free Consultation with an Attorney? That's good. If you have the time, you might try to make a Free Consult with a different Attorney.

Just a suggestion. Go in there with Printed Information. For example, if you don't have Quicken or software like that, I'm sure you probably have either Excel or Microsoft Works which has a spreadsheet. Make a list of your last 6 mths checks starting with the gross income & breaking out the different taxes & any other items that are deducted from your paycheck.

Then estimate or use facts, your monthly expenses without your credit cards. I broke my list down to mortgage payment, gas, electricity, satellite, cell phone, auto insurance, food, gas for vehicle, etc. I even took my personal property bill and divided it by 12 and showed that expense. Our 2 car insurance comes out auto-debited and our home insurance along with real estate is included in our mortgage payment.

You want to be able to show the Attorney you have less than $166 or it might be $167 (somewhere around that figure) left over to be able to file a Chapter 7.

Also, if you own a home, go to realtor.com and there's a place that's say what's my home worth. You can type in your address & it will show stats on homes sold in your area. I added them $$ amount up along with the sq. Footage & took that number and multiplied it by my sq. footage to get an estimate on how much how home was worth. Then you need to know the Principal amount owed on your home.

Same thing with vehicles. Our Distrist uses nada.com retail value. My van is paid for and is over the exemption of $3,200. I hoping because I ran into my father's mailbox several years ago & did damage of $1,100 to the rear of my van, I didn't get it fixed as deductible at time was $1,000. Going to get an repair estimate for that. Plus I'm 100% disabled & the rear seats are out & I had a lift installed with a remote control to get my scooter in & out for me to use. So hoping maybe some $$ amount will be an exemption for disability aids.

Dh's truck has a loan on it and is upside down so not too worried about that one. The more info you are able to supply to the Attorney, the best results you will get. You can make a list of your individual credit cards & their balances, but he/she probably won't be interested because all should be wiped out in a Chapter 7.

Good Luck keep us posted.

Luci

[nodollarsnomo]

Pizza, just curious about it being easy for creditors to freeze accts. in Texas. Where did you find this info? I live in Texas and that really scares the heck out of me.

[LuciluS]

Pizza, just curious about it being easy for creditors to freeze accts. in Texas. Where did you find this info? I live in Texas and that really scares the heck out of me.

Hey nodollar:

Read his last sentence again, dear. He says creditor's CAN'T easily freeze accounts in TX.

I sometimes have to re-read sentences several times before I understand them. Of course, I always tell my husband, I have a good reason....It's all the medicines I take to have any quality of life LOL!

I haven't felt good today which has made me kinna down in the dumps. Your eyes not being focused made me Laugh!

Luci

[Pizza]

Pizza, just curious about it being easy for creditors to freeze accts. in Texas. Where did you find this info? I live in Texas and that really scares the heck out of me.

Sorry, 'can't was a typo. I meant creditors CAN easily freeze accounts, it's the most common type of asset that is totally non-exempted, at least under Texas exemptions (w/Federal I'm not sure if you can use the wild card or not).

It most commonly happens when you have a debt with the same bank you have a checking account with, but if a creditor gets a judgment (and can find your account) they can freeze it.

[LuciluS]

Yes that is true Pizza:

Any individual who owes a bank for a Credit Card, Auto Loan, Unsecured or Secured loan and has a checking or savings account and is getting behind in paying bills Needs to Close that checking or savings acct. immediately.

In order for a Creditor to obtain a Judgement, they must first file suit against the Debtor. Here's a blog about a Judgements in Tx:

http://www.deancooklawfirm.com/2007/10/post-judgment-collection-in-texas.html

Luci

[Pizza]

Gotcha! I understand, now. Yes, I would want to try to put at least 90 days inbetween purchasing and not paying. I guess you are getting a Free Consultation with an Attorney? That's good. If you have the time, you might try to make a Free Consult with a different Attorney.

Just a suggestion. Go in there with Printed Information. For example, if you don't have Quicken or software like that, I'm sure you probably have either Excel or Microsoft Works which has a spreadsheet. Make a list of your last 6 mths checks starting with the gross income & breaking out the different taxes & any other items that are deducted from your paycheck.

Then estimate or use facts, your monthly expenses without your credit cards. I broke my list down to mortgage payment, gas, electricity, satellite, cell phone, auto insurance, food, gas for vehicle, etc. I even took my personal property bill and divided it by 12 and showed that expense. Our 2 car insurance comes out auto-debited and our home insurance along with real estate is included in our mortgage payment.

You want to be able to show the Attorney you have less than $166 or it might be $167 (somewhere around that figure) left over to be able to file a Chapter 7.

Also, if you own a home, go to realtor.com and there's a place that's say what's my home worth. You can type in your address & it will show stats on homes sold in your area. I added them $$ amount up along with the sq. Footage & took that number and multiplied it by my sq. footage to get an estimate on how much how home was worth. Then you need to know the Principal amount owed on your home.

Same thing with vehicles. Our Distrist uses nada.com retail value. My van is paid for and is over the exemption of $3,200. I hoping because I ran into my father's mailbox several years ago & did damage of $1,100 to the rear of my van, I didn't get it fixed as deductible at time was $1,000. Going to get an repair estimate for that. Plus I'm 100% disabled & the rear seats are out & I had a lift installed with a remote control to get my scooter in & out for me to use. So hoping maybe some $$ amount will be an exemption for disability aids.

Dh's truck has a loan on it and is upside down so not too worried about that one. The more info you are able to supply to the Attorney, the best results you will get. You can make a list of your individual credit cards & their balances, but he/she probably won't be interested because all should be wiped out in a Chapter 7.

Good Luck keep us posted.

Luci

Yes, that's what I plan on doing. I used the government's means test calculator last week - it gives you certain automatic allowances for your household size (ours is 3) compared to others in your state, and you can plug in certain additional bills, expenses and your credit card debt to come up with you total 'disposable income'. Our disposable income was about $-900 a month without the credit cards (wow), and I took it twice looking it over very carefully. A Chapter 13 would pay off about "-$25,000" over five years. I think it's safe to say that we're losing a fighting battle against the cards.

One thing that I did that is probably a good thing for any homeowner to do was protest my taxes. The 'value' of most houses generally goes by size only. With an older home, the true value granted by the appraisal district was almost equal to our mortgage amount. It costs the equity, but lowers the taxes, and under federal exemptions at least, without equity you can keep much more property.

Our cars are a lease car and a junker. That's a factor in how we got into money trouble, trying to keep the junker car driveable to avoid a second car payment (there's no way I can think of we could ever afford two car notes).

Still, we'd been 'making it' up until the credit card companies went crazy with our credit lines and minimum payments. Now we wait for the nasty letters and respond. It's a course of action that I've sort of expected to come up eventually, but the companies got in a hurry to create this situation this summer for some reason.

Yes that is true Pizza:

Any individual who owes a bank for a Credit Card, Auto Loan, Unsecured or Secured loan and has a checking or savings account and is getting behind in paying bills Needs to Close that checking or savings acct. immediately.

In order for a Creditor to obtain a Judgement, they must first file suit against the Debtor. Here's a blog about a Judgements in Tx:

http://www.deancooklawfirm.com/2007/10/post-judgment-collection-in-texas.html

Luci

Thanks for the link. Can you tell I've been doing my research?

I joined the board and started researching back when I was just "a little worried", and have continued to do so until the worries have materialized, over a year later. It has been worth it to plan for what may happen, and refreshing to read points of view from everyone's unique situations.

Thank you and God bless.

[eddiep]

It seems like it is at least six months of no payments before a creditor files a lawsuit and you will have about one months notice before the hearing. so take your time, make sure you have the best six month look back period before filing. And yes I can tell you have done your research, when is your bar exam?

[Pizza]

It seems like it is at least six months of no payments before a creditor files a lawsuit and you will have about one months notice before the hearing. so take your time, make sure you have the best six month look back period before filing. And yes I can tell you have done your research, when is your bar exam?

Yeah, I think it might have been BigBoy2U that said '6 months-never'.. but some are aggressive, some are not. Some think they'll never recover their money and just disappear while others take that chance quickly. It's not fun being in limbo, but in reality that's where we all are in one way or another every day.