Pre File question...

[schel]

1- We currently bank at a Credit Union.
We have a line of credit sitting at about 10K.
Our current truck loan is also there at about 15K
Our Visa is also through Credit Union and at 5K

We want to discharge the line of credit and the Visa, but not the truck loan.

2- What if we transferred our line of credit to other cards so our
line is at ZERO and then file. How long after switching the line
of credit to another card would we have to wait to file and be
able to have it discharged? Would we have to change the Visa
to another visa also?

Any other suggestions welcomed greatly.

Thanks.
Schel

[HHM]

Yep, BK's and credit unions don't mix. Odds are, (although it is of questionable legality) the credit union would require all debt with them to be reaffirmed in order to reaffirm and keep the truck.

Basically, what you are suggesting is out-and-out BK fraud (so just be aware of that fact). Having said that, if you are able to spread the amounts around (i.e. $3,000K to X card, $3,000 to Y card, etc) and not do the transfers all at once, you can probably get the discharge if you waited 6 months, If you need to transfer more money than that onto a single card, you are looking at waiting 9 months to a year+. But there is no guarantee, also, if at all possible, to at least make it seem like the transactions were in your best interests, the cards onto which you transfer these balances should have a lower interest rate than what you are currently paying and you would have to make at least minimum payments during the waiting period.

[schel]

So if we only want to keep the truck, are we ok to transfer the loan elsewhere? Or would we be better off trading it in and getting a new truck thus, our loan would go elsewhere when we get the new truck.
Schel

[danaf]

Is 15k all you are wanting to bk?

[schel]

No...I wish, if that was the case, we would not be filing.
5K on one card,
6K on another,
10K on line of credit,
15K on another card,
5K on another.
$500.00 on another

We also have some hefty medical bills.

Not that the medical bills is what put us where we are totally, but it didn't help. It doesn't help that I got sick, was out of work for 10 months and now have restrictions keeping me from working a 40 hour week. If I do more than 24-30 hours a week, I have residuals that make me miss more work.

All cards are pretty much maxed out.
All the stress of this doesn't help my condition either. I have a supressed immune system and the stress makes things flare like fuel for a fire.

I am so stressed out trying to make payments on the cards until we finally file. So I am so greatful for all answered questions here on this site.

Oh, and our credit is 700-750, so thats why we wonder about the truck issue. We need a vehicle for work and it has 3 years left on payments, but is at the CU.

Thanks again.
Schel

[schel]

Yep, BK's and credit unions don't mix. Odds are, (although it is of questionable legality) the credit union would require all debt with them to be reaffirmed in order to reaffirm and keep the truck.

Basically, what you are suggesting is out-and-out BK fraud (so just be aware of that fact). Having said that, if you are able to spread the amounts around (i.e. $3,000K to X card, $3,000 to Y card, etc) and not do the transfers all at once, you can probably get the discharge if you waited 6 months, If you need to transfer more money than that onto a single card, you are looking at waiting 9 months to a year+. But there is no guarantee, also, if at all possible, to at least make it seem like the transactions were in your best interests, the cards onto which you transfer these balances should have a lower interest rate than what you are currently paying and you would have to make at least minimum payments during the waiting period.

We havn't done anything yet except open a new checking/savings (savings only at $25.00 to keep it open) acct. at Wells Fargo. Wondering now if we should have looked into a new credit union instead. What I read here about Wells Fargo is not so great with BK. Or am I misinformed?

You answered my question above and now know not to go that route with transfering line of credit and Visa, our lawyer did say it was ok to transfer the truck loan though. We are on the fence on if we should do that or look into a new truck being our credit is still 700-750.

We can't do the waiting period so transfering is a no go. Just the minimum payments are killing us right now as it is.

Thanks, and again, all feedback is welcomed and helpful. This is how I learn also.

Schel

[danaf]

while credit unions aren't friendly - and someone correct me if I'm wrong, I think you could bk everything and then just keep up the truck payments and not reaffirm it. They don't want your truck - they'd much rather see you paying it. They won't take your truck if you keep up with payments. By not reaffirming, it would not reflect positively on your credit reports, however - you could walk away from it any time in the future should things get rough.

If your credit is that good, you may decide to trade in the truck for a new vehicle(if you can afford it). Then you'd be done worryng about the credit union and the monthly payment will most likely help you during bk. Plus, you'll have a new vehicle to last you during rebuilding. Mind you, you will still have to decide whether or not to reaffirm new car just like you would have had to with the old one.

[HHM]

while credit unions aren't friendly - and someone correct me if I'm wrong, I think you could bk everything and then just keep up the truck payments and not reaffirm it. They don't want your truck - they'd much rather see you paying it. They won't take your truck if you keep up with payments. By not reaffirming, it would not reflect positively on your credit reports, however - you could walk away from it any time in the future should things get rough.

If your credit is that good, you may decide to trade in the truck for a new vehicle(if you can afford it). Then you'd be done worryng about the credit union and the monthly payment will most likely help you during bk. Plus, you'll have a new vehicle to last you during rebuilding. Mind you, you will still have to decide whether or not to reaffirm new car just like you would have had to with the old one.

Problem is, all accounts at a CU are cross collateralized, based on the experience of the members on this board and others, if you do not reaffirm, CU's will actually repossess for failure to reaffirm and further, will repo for failure to reaffirm other debts with the CU. Unfortunately, the usual rules regarding secured debts do not apply to CU's.

If you can transfer the truck loan (i.e Refi with another lender), and have new bank accounts, then you are should be ok.

[schel]

Problem is, all accounts at a CU are cross collateralized, based on the experience of the members on this board and others, if you do not reaffirm, CU's will actually repossess for failure to reaffirm and further, will repo for failure to reaffirm other debts with the CU. Unfortunately, the usual rules regarding secured debts do not apply to CU's.

If you can transfer the truck loan (i.e Refi), and have new bank accounts, then you are should be ok.

I think we are looking at transfering the loan. Only thing I worry about is our other vehicle has 146,000 miles on it and will hopefully last another 3 years. I worry about trying to purchase a new vehicle 3 years down the road.

We opened an account at Wells Fargo. We could have gone through a CU through my work. Both are accounts through my work. Do you think we should switch to a CU instead?

Schel

[HHM]

We opened an account at Wells Fargo. We could have gone through a CU through my work. Both are accounts through my work. Do you think we should switch to a CU instead?

What part of "CU's and BK don't mix" did you not understand.

[danaf]

thanks HHM for clarifying that- as I wasn't sure.

schel - if you are thinking to transfer the loan to another CU - make sure the CU has absolutely no affiliation with your current CU - otherwise cross collatarization may be in effect too. Often and esp. in the same city - the CU's sister up with other CU's.

[schel]

I am not sure if they "sister up" One is through my husbands past work and the other is through my current work. But by what you said, we already opened with WF and will stay there. I just worry about our future credit and rebuilding it. I am doing lots of reading.
Thanks.
Schel.

[cleo1357]

Another line of attack that I have seen my credit union take- they let you pay on your unreaffirmed vehicle, instead of repossessing it under cross-collateralization. Then when you've paid off the vehicle, they won't give you the title, because it is secured by the other loans. If they won't let you reaffirm- surrender the vehicle. It will be better in the long run.

[cleo1357]

Another line of attack that I have seen my credit union take- they let you pay on your unreaffirmed vehicle, instead of repossessing it under cross-collateralization. Then when you've paid off the vehicle, they won't give you the title, because it is secured by the other loans. Sneaky, huh?