To be completely frank and clear

[Raymod57]

I find myself in a painted corner financially. My only income is Social Security of $1200@ month, have 7 credit cards with balances between a low of $800 and a high of $5000, totaling $17K. My only asset is a car worth $15K. I can't pay them, 90 days past due next week, all of them. What is the timeline of whats going to happen? Oh, my doctor says my cancer is back, 5 year survival is 30%. Should I sell the car, or can I legally? Will they take it?

[shipo]

Wow, sorry to hear about the cancer.

Can you work at all? If so, maybe you can augment your income a bit and pay down the credit cards. What about food stamps or other types of assistance?

[Raymod57]

No, I am on Social Security disability, recurrent Cancer-I'm finished, just looking for a timeline of whats coming, court, sheriff sale, etc..

[justbroke]

Welcome to BKForum Raymo57.

It's hard to tell with the moratoriums and the self-initiated mitigation that many lenders are doing today. It's just too hard to fashion a guess as to what the creditors would do. I mean, they would clog up the courthouses with the millions of cases and that would just grind the system to a halt. (The system grinding to a halt is much like Florida during the housing crisis where they pulled judges out from retirement and used questionable techniques such as the infamous 'rocket docket' to rip through foreclosure cases.)

Additionally, each creditor, and type of creditor, handles late payments and charge offs differently. Since you are receiving SSDI/SSI payments as your only income, it would be quite worthless for any creditor to pursue you. We call this collection proof (and some call it judgement proof).

The question for you, with consultation with an attorney, is whether you need to file bankruptcy.

I hope you beat the C.

[Raymod57]

Thank you justbroke for your thoughtful, clear reply. Since I have no cash, but don't know the laws prior to BK, I thought of selling the car for some cash since I am "cashless", or borrow against it? I didn't know if I was liable to lose it through a sheriff sale or whatever judgement they get. Will I get notice of something like that?

[justbroke]

While I can't tell you to sell your car, there's nothing that would prohibit you from selling your car in order to survive. Bankruptcy only worries that you sold the car for "less than the (current) value" or that you transfer it to an "insider" to hide it from creditors (or the Trustee).

As it appears you know, once a creditor obtains a judgment, they can then seek to execute that judgement against your personal property by having a Sheriff's sale or something similar. I don't practice law in California, but there may be exemptions -- such as those in bankruptcy 0-- which protect certain property. For example, California has two exemption schemes (systems) which cover various property from process (lawsuit/bankruptcy). Picking the correct one may be important. There may or may not be enough in exemption value to protect a $15K vehicle.

Typically if you're sued you must be notified of the lawsuit. Then the creditor must issue you a summons and you'd appear -- or not -- to the scheduled hearing. At some point the creditor may win a judgement. After the judgement the creditor will usually issue some sort of query into your property known as an interrogatory. That's how they learn about bank accounts and other things. After that point, the creditor may ask the court to execute a writ (an order) to levy your property.

Short answer: yes you would be notified as notification is a requirement.

I think your question about borrowing against the vehicle is interesting, but if you can't pay the bill you may have issues later. Definitely, no matter what you do, don't get a so-called title loan from one of those loan sharks. If you must do it, check with a credit union as many will do a loan against a vehicle that is paid in full.

Overall, you're going to need to address your finances and expenses and find a workable and livable solution.

[flashoflight]

Writ of execution on a car is unusual in California because the sheriff fees are very high, the creditor has to pay upfront, there is an exemption if claimed by the debtor with very short deadlines, and there is a risk of losing money repo'ing the car this way. $15k they might still do it to get a profit of a few $k gambling that the debtor won't file the exemption claim to the sheriff in a timely manner. Pre-covid you had to go to the main sheriff's office to get the exemption paperwork and file it within 10 days or something like that. No idea how it's done now.

Don't get a title loan. The only good moves are to keep the car or sell the car to Carmax/Carvana/private sale.