Question Start Chapter 7 ... some questions

[bornfree2]

Some quick notes about my case

debts
- over 50k in CC debt between two banks
- received summons 18 days ago . sued for 18k. i have to file a response in 12 days (??)
- behind in rent by several months (5k+) . covid rules has allowed me to remain without eviction

Assets
- no house, renter (behind in rent)
- a car i own worth $5k
- cash less than 2k
- misc house stuff, books, clothes, etc worth less than 5k

No job and no income since 2 years... def no income in last 60 days and 6 months
- got by with debt
- occasional cash gifts from family
- selling off stuff (ebay)
- small gigs along the way

Presently unemployed

Honestly i dont know how i survived this long without income..but then again i have over 50k in debt staring at me lol

I have read as much as I can and started to pretend fill out the forms. I have an understanding of the exemptions (wild card of 30k in my state CA to probably cover everything). But as I fill the forms I am realizing what i dont understand.

So on to my questions

- how do i answer my summons? Do i ignore it and let it default to judgment? try to buy time by somehow learning how to pro se some response 'answer'? I wont have everything i need to file properly in 12 days
- I did not file taxes for this year or last (2020,2019) since i had no income. Do i file it as 0? If so do they want something from IRS or can i send in a copy of what i filed (ie a print out of my return that i made out)
- do i have to explain how i got by for 2 years? how im making not income now yet somehow paying rent? will they demand i am lazy and need to find work so i can pay the creditors?

Sorry if i ask to much all at once. Im a bit stressed at the moment

edit: sorry for the double post. cant find way to delete it

[justbroke]

Welcome, again, to BKForum!

- how do i answer my summons? Do i ignore it and let it default to judgment? try to buy time by somehow learning how to pro se some response 'answer'? I wont have everything i need to file properly in 12 days

I'm not a California resident so I don't know the process there. I have heard that there's a $200 cost to submit a response or I'm completely wrong. As such, I can't answer these questions.

- I did not file taxes for this year or last (2020,2019) since i had no income. Do i file it as 0? If so do they want something from IRS or can i send in a copy of what i filed (ie a print out of my return that i made out)

You would need to file an affidavit that you had no income and hence were not required to file a tax return. Your specific district may have a "local" form that you can complete.

- do i have to explain how i got by for 2 years? how im making not income now yet somehow paying rent? will they demand i am lazy and need to find work so i can pay the creditors?

The Trustee may ask at the 341 Meeting, but they do know and see lots of cases where there is $0 in income. While the bankruptcy trustee can ask why you're not working, they can't demand that you work to pay creditors. Especially since many of the calculations are based on what one did in the period 6-months prior to filing.

Sorry if i ask to much all at once. Im a bit stressed at the moment

This is actually about an average size initial post but we wouldn't care a bit if it was more.

[bornfree2]

1- yes its $200+ just to answer it. My options as i see it is not answer and let it go to judgement. However, i dont want to do that as i want to keep my bank account from from their fingers. I also kinda sorta want to learn how to stand up for myself challenge stuff in court but throwing $200+ for this kind of education is wrong when i have no money.

2- The pandemic in ca allowed people to pay 25% of their rent up until july of this year. Then its all due. However, they also established a fund to pay the landlord 80% of my balance in lieu of forgiving 20%. My landlord seems amiable to this but i have to do all the legwork. Its nothing like this BK7 paperwork but also requires proof of income, tax returns, etc to apply. So im hoping that will get me out of that debt BUT i have to pay full rent in 2 months. Thus, i need work

3- Is there a way i can tell my sad, but truthful story, for the trustee to read? I am very bad at verbal communication and better at having time to present out 'my situation' so to speak. Or is it like an interrogation at the 341?

4- THANK YOU FOR YOUR WORDS YOU HAVE MADE MY OUTLOOK CHANGE ;)

[justbroke]

1- yes its $200+ just to answer it. My options as i see it is not answer and let it go to judgement. However, i dont want to do that as i want to keep my bank account from from their fingers. I also kinda sorta want to learn how to stand up for myself challenge stuff in court but throwing $200+ for this kind of education is wrong when i have no money.

I don't know how quickly things work in California, but you don't want it to get to become a judgment lien. You have some time to file a bankruptcy.

I highly recommend that you seek out the Pro Se / Pro Bono clinic at the Bankruptcy court. California has many of these as does Florida. They will help you and even answer legal questions, which I cannot.

2- The pandemic in ca allowed people to pay 25% of their rent up until july of this year. Then its all due. However, they also established a fund to pay the landlord 80% of my balance in lieu of forgiving 20%. My landlord seems amiable to this but i have to do all the legwork. Its nothing like this BK7 paperwork but also requires proof of income, tax returns, etc to apply. So im hoping that will get me out of that debt BUT i have to pay full rent in 2 months. Thus, i need work

That makes sense that you would seek some work to cover the rent.

3- Is there a way i can tell my sad, but truthful story, for the trustee to read? I am very bad at verbal communication and better at having time to present out 'my situation' so to speak. Or is it like an interrogation at the 341?

I'm not trying to make your story not appear to be unique or genuine, but trust me when I say that the Chapter 7 (and Chapter 13) Trustees have heard everything. It is highly recommended that you not speak, volunteer information, or say anything other than "yes" or "no" to the questions asked at the 341 Meeting. If the Trustee asks a probing questions that requires a longer response, just don't go off on tangents! They actually don't need to hear the detailed information unless they ask for detailed information.

From what I have read, you present as a textbook case for a Chapter 7 discharge. There are no major assets and the case is likely to easily be a no-asset case.

[flashoflight]

I wonder if you should delay filing BK. We live in weird times right now where you are immune from eviction for payment and can choose to stop paying your landlord, mortgage lender, and student loan servicer with very little adverse effect. It's better to wait until your life gets better with stable housing and sufficient income to live on without credit. Then you discharge all of the back rent and everything else. You can only file once every eight years. California is well known for thriving as a professional tenant and learning how to string out an eviction for many months even when non-payment evictions restart and you'd still have the BK in your back pocket to string it out even longer to build your savings up to the wildcard. If you had a job right now, you could save up for the huge deposits you will need to find a new place. So finding a job ASAP in anything is key. Bankruptcy won't solve the underlying issue which is no income.

I'm from California and I got sued left and right by everyone. So with regards to the lawsuit. It costs court fees to file an answer but I believe there is an indigent program to waive those fees. The answer itself could be pretty easy to file pro se, especially if you can do a general denial (depends on the size of the lawsuit). Look at forums on the Internet for sample answers and the correct form for responding. When you get interrogatories and request for admission from the plaintiff, it gets harder to do the paperwork right but there is online defendant boilerplate in forums for responding to the boilerplate interrogatories of each debt collector. So if you default, your judgment creditor will almost certainly find your new job and drain 25% your paycheck. That's why I think you should defend the lawsuit if you can get a court waiver for the fees. Your paycheck may be exempt from garnishment, but it took over 6 months to get the money back from the sheriff pre-COVID in California.

But right now with things still in pause, find a job in anything and pocket the money for the down payment on your new place. I'm starting to see job ads in California.

[bornfree2]

I don't know how quickly things work in California, but you don't want it to get to become a judgment lien. You have some time to file a bankruptcy.

1- if i let it go to judgement, they next move for a lien? And thats not dischargeable? Then if i get a job within a few weeks, they can start to take money out?

2- How do i figure how much time to file after it goes to judgement? It sounds like a default judgement is the trigger to the last point of return for making this discharge cleaner for me no?

From what I have read, you present as a textbook case for a Chapter 7 discharge. There are no major assets and the case is likely to easily be a no-asset case.

Again thank you for the hope! You have a crisp style of writing that is amiable and discerning.

[justbroke]

1- if i let it go to judgement, they next move for a lien? And thats not dischargeable? Then if i get a job within a few weeks, they can start to take money out?

First rule of bankruptcy, all liens survive bankruptcy. There are some exceptions. Even with the exceptions the debtor usually would need to file a motion to determine secured (lien) status to have the lien deemed dischargeable. The only time that is (usually) the case is where the lien impairs an exemption and the lien is non-consensual.

2- How do i figure how much time to file after it goes to judgement? It sounds like a default judgement is the trigger to the last point of return for making this discharge cleaner for me no?

I don't know for California, but if I were a creditor I would record my judgment immediately (in the public record) so that it attaches to all the debtors property. That's what makes it a judgment lien.

Again thank you for the hope! You have a crisp style of writing that is amiable and discerning.

Thank you. Years of practice. On BKForum, all the members try to be to the point and honest. Sometimes I'm brutally honest. I just don't see any issues with your debt or your ability to file a Chapter 7 and receive a discharge.

[bornfree2]

1- What do you mean "creditor can attach itself to ALL the debtors property"? You mean the value they demand (say 20k) becomes immediately due and there is a forced liquidation? They just raid the bank accounts, send out the repo man, etc and thats that?

2- This event as you describe it sounds exactly what happen when the trustee gets ALL your property once you file. So either the creditor gets it or the trustee lol. What motions or whatever do they do after the default judgement? Do they just send out the repo man, and send the email with pdf attachment of their default judgement win to the bank says "Roger that, take it all boys".

Is it too late for bankruptcy at that point because as you say 'first rule is leins survive BK'?

3- Now it sounds like im being hussled (not by you!! By the way the system is triggering these events) into filing in two weeks before my summons 30 days runs out. Literally 12 days from now. LOL.Yeaa right. (As I reach over for the remote in denial of reality)

I feel like im now in a chess game and if i make the wrong moves or dont move at all, they eat me up pac man style . gooble gobble. pew pew pew.. I dissolve into abject poverty by the great and mighty credit card overlords!

[justbroke]

1- What do you mean "creditor can attach itself to ALL the debtors property"? You mean the value they demand (say 20k) becomes immediately due and there is a forced liquidation? They just raid the bank accounts, send out the repo man, etc and thats that?

A judgment lien attaches to all the debtors property. That's the entire purpose of a judgement lien. The purpose is to collect against the debtors (non-exempt) assets which is property. That property could include money in the bank (via levy), future income (via attachment/garnishment), or against real property (foreclosure or just a lien). Yes, they could "raid your account" or seek to take other actions to collect. For example, garnishment of income is popular and, in most States, the judgment creditor could take 25% of your earned income (subject to some limitations). (There are some States that do not allow garnishments by non-government creditors.)

2- This event as you describe it sounds exactly what happen when the trustee gets ALL your property once you file. So either the creditor gets it or the trustee lol. What motions or whatever do they do after the default judgement? Do they just send out the repo man, and send the email with pdf attachment of their default judgement win to the bank says "Roger that, take it all boys".

After a judgment, default or by ruling, the creditor (usually) just needs to file the judgment with the county clerk's office to tell other creditors that they have a lien against all property (and to hold their lien position).

The interesting thing about judgment liens, which many debtors don't realize comes in two parts. First, most judgment liens are good for 10 years and attach to (nearly) all property. Second, most judgment liens can be renewed for an additional 10 years. That means that a judgment lien could be in place for up to 20 years in most States.

Is it too late for bankruptcy at that point because as you say 'first rule is leins survive BK'?

Absolutely not. By default, non-consensual liens cannot impair a bankruptcy exemption. (Well, it's a little more technical than that... as it's the extent to which the non-consensual lien impairs the bankruptcy exemption). This is not an issue for you since you probably won't have any property that is not fully protected.

3- Now it sounds like im being hussled (not by you!! By the way the system is triggering these events) into filing in two weeks before my summons 30 days runs out. Literally 12 days from now. LOL.Yeaa right. (As I reach over for the remote in denial of reality)

Not at all. You can accept the fate of a lawsuit and pay. You could answer the complaint/lawsuit and assert some defense (delay tactic). You could file bankruptcy and preempt the judgement. Or, you can accept the judgment and deal with any lien issues in the bankruptcy. You can deal with liens, in the bankruptcy, which impair a bankruptcy exemption by filing a motion to determine secured (lien) status. It just adds more paperwork and likely a hearing for the court to assert that the lien is void.

I feel like im now in a chess game and if i make the wrong moves or dont move at all, they eat me up pac man style . gooble gobble. pew pew pew.. I dissolve into abject poverty by the great and mighty credit card overlords!

It's not chess, it's more like spades. The Ace of Spades is bankruptcy. Every creditor knows this. If you tell a creditor that you're thinking of filing bankruptcy, many of them will "run to courthouse steps" in order to get a judgment and then record that judgment (making it a lien). This is why you don't show your hand to a creditor. You never promise to make any payment. You only tell them that you can't pay at this time.

I'll leave you with this. Even though a creditor could get a judgment and record or renew it, you could be in what is known as non-collectible status. Because the exemptions protect you, they can't collect anything. So the judgment stays dormant until you actually obtain assets or the creditor learns that you're working (and that the State allows garnishment). We call this situation as being collection-proof (nothing to collect). It's not the best way to go about life, but it works for some people (typically older adults or those collecting income from protected sources such as Social Security, Disability, Military Disability, etc).

[bornfree2]

If I understand you correctly, i then do literally have less than 10 days to file a non complex bk filing.

My major blockage here is i dont have that tax return. Id need 6 week or more depending on the IRS of course.

But you also say i can file something to tell them i didnt need to file taxes. An affidavite. Better yet sounds like this only needs to be on file before the 341. Dammit why didnt i just file my taxes!

I also came across 'skeleton' petitions which promise to deliver things later (within 14 days i think). That would give me 2+2 weeks before the 341 meeting.

Or do i have even. more time since the 341 is schedule in the future. I just have to show up there with the rest of the paper work? (the tax explanation and all my shedules filed but i may have a chance to ammend)

I think i can intellectually handle this. I just want to know i have a winning shot based on my 2 week deadline before this summons date and i have no response in answer. Thus triggering the dominos that fall in creditor favors and makes my life a new nightmare

Sorry thinking aloud. My 'moves' appear to be

1- do nothing, get a default judgement, then have the lien and BK is much harder for me to do alone (worst choice)
2- file a skeletal petition and stop putting off that credit counseling course all within 10 days..maybe 7 with court dates and covid?
3- answer the summons with some thing i cobble together, to buy more time BUT that move costs me ($200+). Potentially that will buy me weeks and weeks with the back and forth (maybe pushing it to trial)

In the meantime the show ill drop on the credit card and they will sue me soon. As you say its a race to the courthouse now to see who gets first dibs of the whole pie.

It looks like the only winning move is to act fast in 7 days....lol...what a crash course im having ( i will be sure to fully document my journey here for the benefit of others....heck if i come out this alive and winning everyone else can do.

WE THE PEOPLE...ARE BORN FREE!!

[justbroke]

I don't see anything in your situation that is complex. I don't think you only have 10 days to file as even if you miss the response date on the lawsuit, there are still so many days before they can receive a judgment. Whether that's 30 days or 60 days, I can't tell you because it's specific to California. Just because there's a non-consensual lien doesn't mean that it's more difficult for bankruptcy. It typically requires just a hearing on a motion to determine. That's only *if* the creditor decides to file a judgment.

Missing a tax return is not a roadblock at all! A bankruptcy only requires that you file all tax returns as required by law. If you didn't have income, then you are not required to file a tax return by law. How your district specifically deals with an affidavit of no tax return, could be obtained with a single phone call to the Clerk's office. (A procedural question regarding whether there is a local form for the affidavit.) Here's an example from a different state: https://www.ch13wdva.com/files/Tax_Return_Affidavit.doc

Generally, though, you are overthinking this.

What I would do, is look to your California US Bankruptcy Court district's website and see if they have Pro Bono or a Pro Se clinic available. That's going to be your best course of action unless you were to hire an attorney. I think that you really need the Pro Bono/Pro Se clinic since this is a lot of paperwork and should never be done as a crash course in bankruptcy petition preparation.

I think that we would both agree that you are not sufficiently prepared to file a bankruptcy petition. Please seek out the Pro Bono/Pro Se clinic at the bankruptcy court.

Northern District: https://www.canb.uscourts.gov/pro-se-pro-bono-services
Central District: http://www.cacd.uscourts.gov/forms/pro-se-clinic-forms
Eastern District (GUIDE BOOK): http://www.caeb.uscourts.gov/documen....pdf?dt=003236

[bornfree2]

Yes i agree on all your points. Esp my lack of prepardeness. Im new to this and the shock of it all as i open my eyes is sitting in. One thing is clear i am DETERMINED and i will win because if i dont, i have to keep being a slave. There is an open door here. And its a smooth entry if i act NOW

I was born free and im done being under the oppression of the creditors. This abusive relationship has gone on my entire adult life. It has robbed me of quality, sleep, ambition, and now wants my very dignity.

Its time to take full responsibility for my life...and face the giants with my BK SLINGSHOT FILING

reboot galore. clear slate. new jobs. new loves. new FREE person!

I DECLARE BANKRUPTCY!! - Micheal Scott

https://www.youtube.com/watch?v=C-m3RtoguAQ

[justbroke]

I am just intent on not recommending what I did. (I filed a skeleton Chapter 13 in 14 days with the rest in the next 14 days. But, that was a Chapter 13 which is, and mine was, very complex.)

[bornfree2]

I am just intent on not recommending what I did. (I filed a skeleton Chapter 13 in 14 days with the rest in the next 14 days. But, that was a Chapter 13 which is, and mine was, very complex.)

Yeah no way i would do this Pro Se for a chapter 13. Nooo way. But you the Wizard so... ;)

Thanks for the clinic help. I will do a drop in to the office this week and see if i can take my cobbled together skeleton petition and see what they say. No idea if they are available due to covid etc. More calls to add to the list tomorrow. Thanks!

[justbroke]

That sounds like a plan! I wish you the best!!!