Judgements

[MomIcantFindmy]

Research and research.

If we just chose to sit and wait until we are taken to court and the cc receive judgements. Are those judgements discharged in BK? (We are not ready to file yet)

The only asset we have is a jeep worth approx $4000. If the judgement holder places a lein onthe jeep will they come get it or just hold onto the judgement until we attempt to sell it?

This is the stuff that keeps me awake at night.

[woeisme]

judgements can be discharged in BK, I know because my husband had 3 (1 that was being enforced through wage garnishment and 2waiting in line to get his paycheck that got stopped in their tracks.)

Whether they'd put a lein on the jeep and how that would all work, I don't know. I know for houses that the lein sits until sale, but for other property, not sure if they are handled differently. Hopefully someone else can help there. Good luck!

[Minnymouth]

Most cc companies will go for wage garnishments instead a lien against your jeep. Now if you jeep is not totally paid for the original creditor on the jeep holds the 1st lien and the others will all have to stand in line and take a number.

[Needing Help]

I asked my atty. this same question today, and his answer was "absolutely". The disadvantage is that in addition to a bankruptcy on your record/credit report, you will also have "judgments" against you. It will further damage your credit and may hurt you in the future.

That's what I was told. Anybody agree/disagree???

[rilbrianne]

I doubt a credit card company will put a lien on your vehicle. They'll probably seek a judgment to garnish wages. Even that will take time.

I had the same thing, a judgment that the bank took lien on my car for. They wanted the car to sell (which won't happen to you, my bank had the loan for the car) but I had sold it for $75 after the trans went out. They threatened to come raid my house but I never heard back from the bank's attorney. It's been about 4 years. I even tried to make arrangements but they wouldn't have any of that. Judgment was discharged in BK just last December.

I'm sure you'll be fine.

[familyof7]

I had the judgements removed from my credit report. They were included in bankruptcy

[rrockinggramma]

Judgements can be included in your BK. I went to the court with my BK paperwork and the clerk notified the CRA's and they have now disappeared from my transunion and experian. Equifax is more difficult. LOL

[MajorMike]

You mean BLUE BOOK value, don't you?

[no_it_all]

You can have a family member "loan" you a reasonable amount like $3500 or so and you give them a security interest in the jeep (you got fair consideration for the loan and collateral provided) You go get security agreement and do a UCC filing. You get to keep the title in your name and then make "payments" to the person who loaned you the money. This will encumber the item from creditors but will not protect it from a BK.

Dude, that is sick, I love it...

[MomIcantFindmy]

OK this is how it works....it would help if you told us the amount you owed but thats OK. First I don't know where you got the "value" of your Jeep. You need to use the "black book" value. Now that is what it would sell for at auction. So then we look at if you own other vehicles? What the exemption amount is for your state. So lets say the Jeep "you" think is worth $4000 really has a black book value of say $2500 and you get a $2500 vehicle exemption then nothing can happen to your jeep. No CC company is going to go after an asset that is exempt or close to being fully exempt. I mean lets say your Jeep needs repairs that would further decrease the value. Now if your jeep is a play toy and is really worth $4000 and you already exceed your allowable exemptions there are some tricks that can be used to encumber the asset from creditors. However! these tricks do not work when it come time to file BK unless you wait for about a year. One method is to borrow against the jeep (encumber). You can have a family member "loan" you a reasonable amount like $3500 or so and you give them a security interest in the jeep (you got fair consideration for the loan and collateral provided) You go get security agreement and do a UCC filing. You get to keep the title in your name and then make "payments" to the person who loaned you the money. This will encumber the item from creditors but will not protect it from a BK. The trustee will overturn this agreement if its not a "true" loan. If you really did borrow the money from a relative and received fair consideration for the item pledged as collateral (check from relative showing amount loaned, signed loan docs, UCC filing or title transfer and history of loan repayment) then it would survive BK and you can even have it discharged and let your relative repo it and after your BK is done you go get it back and complete the transaction. The whole point is...no matter what you do always do it in plain view. File papers, keep a paper trail, get fair consideration etc. But first thing is to see if the Jeep is really worth $4000 and if you can exempt it. I encumbered over $40K in business vehicles and tools that I own to make those items from being attached to by a creditor.

I love the information on this board. Not that I would do all of it but I find that the more information I have the better choices I can make for my situation. Thank you.

[ssdsco]

No it is really called "black book" value...its the value items (mostly cars, RV's, boats etc. sell for at an auction, google it.


Most BK attorney's go tell you to get an item appraised or have an auction house give you a basis what an item sells for at auction. Car dealers can give you the price of what your car IS SELLING for right now at the dealers auto auctions. For example a year ago I had an 05 Escape I owned outright low miles. I wanted to sell it but noticed all the dealers were selling them at a low price compared to "blue book". Called a friend of mine and said look this up on the auction list and he pulled up the sales for the last couple months. They were flooded with 04,05,06 Escapes and listed the mileage general condition and if it was a rental, lease return or other. Showed the sold price to dealers for any geographic area he wanted to look at (his search covered the west coast) So he was able to give me the average auction amount for an 05 Escape with 29K on it. Its like $3000 less than dealer trade in in the blue book, and like almost $6000 less than retail. So something I should have gotten $15K for was selling at auction in the $9-10K range.

My point is "blue book" value means nothing its what an item can be sold for right now today in the condition its in AKA "black book". And that is what your exemption on personal property is calculated by or an appraisal.

Another example is I have about $15K worth of power, hand and misc construction tools (replacement value) but as my attorney said....if you put all those in one lot, at an auction and no one could try them but only buy them as a lot of tools, how much would you be willing to pay? I said I guess about $2-3k at most and I know all about them. She then said still worried you meet the exemption and keep all your tools? If you are, take them all down to ABC auctioneers and ask them what the lot might sell for and get it in writing as an estimate of value.

Is it possible to get the black book value online and for free ? Thanks for the info.

[jp2861]

OK this is how it works....it would help if you told us the amount you owed but thats OK. First I don't know where you got the "value" of your Jeep. You need to use the "black book" value. Now that is what it would sell for at auction. So then we look at if you own other vehicles? What the exemption amount is for your state. So lets say the Jeep "you" think is worth $4000 really has a black book value of say $2500 and you get a $2500 vehicle exemption then nothing can happen to your jeep. No CC company is going to go after an asset that is exempt or close to being fully exempt. I mean lets say your Jeep needs repairs that would further decrease the value. Now if your jeep is a play toy and is really worth $4000 and you already exceed your allowable exemptions there are some tricks that can be used to encumber the asset from creditors. However! these tricks do not work when it come time to file BK unless you wait for about a year. One method is to borrow against the jeep (encumber). You can have a family member "loan" you a reasonable amount like $3500 or so and you give them a security interest in the jeep (you got fair consideration for the loan and collateral provided) You go get security agreement and do a UCC filing. You get to keep the title in your name and then make "payments" to the person who loaned you the money. This will encumber the item from creditors but will not protect it from a BK. The trustee will overturn this agreement if its not a "true" loan. If you really did borrow the money from a relative and received fair consideration for the item pledged as collateral (check from relative showing amount loaned, signed loan docs, UCC filing or title transfer and history of loan repayment) then it would survive BK and you can even have it discharged and let your relative repo it and after your BK is done you go get it back and complete the transaction. The whole point is...no matter what you do always do it in plain view. File papers, keep a paper trail, get fair consideration etc. But first thing is to see if the Jeep is really worth $4000 and if you can exempt it. I encumbered over $40K in business vehicles and tools that I own to make those items from being attached to by a creditor.

It's outright fraud and wouldn't suggest anyone attempt such a stunt.

[ssdsco]

It's outright fraud and wouldn't suggest anyone attempt such a stunt.

Even with fair consideration and the proper loan and lien documentation ?


My state has $2400 vehicle exemption and $50K homestead exemption. No wildcard. My car is paid off and worth $8400. My home is slightly upside down but I plan to keep it when I file BK7.

I plan to maximize my exemptions by taking a $6k loan on the car from my father, do the loan doc, file the lien, pay him $150 month. End up with $2400 in equity.

I'm going to take the $6k and pay down my 2nd mortgage.

Any issues with this ?

Thanks

[FreshLikeADaisy]

ssdsco, I have to say I'm with you on this one. If someone creates an incumbrance right out in the open as BigBoy described, it may be questionable as far as ethics go -- and that's between the filer and their God -- but not fraud and not illegal. As BigBoy himself said, "The whole point is...no matter what you do always do it in plain view. File papers, keep a paper trail, get fair consideration etc."

I've written several posts encouraging people not to hide assets or lie or attempt to evade scrutiny on their filings, and I stand by that 100%. I just can't see that what BigBoy described is any of that. I have also seen several posts here where filers did exactly that, especially when the parents had purchased a vehicle for the filer and even though the filer was paying them back, the clear title in the filer's name made it fair game for the trustee. I honestly see no ethical problem with that, but that's just me.

Ah well. Caveat emptor, and all that.

[Cali]

Most cc companies will go for wage garnishments instead a lien against your jeep. Now if you jeep is not totally paid for the original creditor on the jeep holds the 1st lien and the others will all have to stand in line and take a number.

How long does a company wait until the they try to garnish your wages? We are in the wait period before filing and I don't want a garnishment for my hubby since he is military.