Retirement threatened?

[Thought Doctor]

I believe that retirement funds are considered exempt? Problem is, my wife and I have invested in real estate, anticipating liquidation of that eventually, using the equity as our sole retirement income source. Now, because of the market downturn, nothing is selling and we are being bled out of our equity...and are now worried we will end up in 5 years eating dog food and working at Wal-Mart!

We are considering BK, but would it mean all our retirement is gone? This would be disasterous, of course, as I am currently on disability, cannot work and likely will not be able to in five years, once the disability income ceases. Scary.

Any thoughts or suggestions?

[lrprn]

Unfortunately with all your retirement eggs in one basket (real estate), now you are as vulnerable as those screwed folks at Enron who had only Enron stock for their retirement who lost everything when Enron went belly up (but not until after their executives got their money out). I'm sorry that you are now finding yourself in this sad situation.

Other than trying to sell your properties now rather than filing bankruptcy, with your inability to work it's hard to suggest anything else at this point. Hopefully other members will have different ideas for you.

[Thought Doctor]

Perhaps, since I still have the ability to draw substantial approved equity from the properties, we should keep doing that for awhile, get things in better order before further consdiering filing? We need a new car, as the lease is nearly out on the current one.

All our properties are for sale, and have been for 1 1/2 years now...with no offers! Talk about a conundrum...properties are worth well over $2,000,000 with $800,000 in equity...a worthless figure if they can't sell!

If we did by a car, arrange for some of the necessities to carry us through about five years of a Ch 13, maybe that is the best possible scenario?

[keepmine]

This is where preplanning a bk is the order of the day. You need to speak with a few bk lawyers who also have knowledge of asset protection and figure out a way to turn whatever equity you have into exempt assets.
Also, do you have a realistic figure that would move the property? If you can't sell at that price, you sure don't have $800K in equity.

[ssdsco]

Time to see BK attorneys to get a good handle on your states BK exemptions and possibly judgment exemptions. You may be able to convert the equity into BK exempt retirement plans, trusts, annuities, etc. Also you may need to consider moving to a state with more favorable BK exemptions and waiting out the 2 year residency requirement.

Be sure to get opinions of at least 3 attorneys and no BK mills. You have a lot at stake here.

And don't pay cash for a car without seeing an attorney.

Good luck !

[Debt.Sux]

A property is worth what someone wants to pay for it. That being said, I would have to agree with keepmine.