Should we file?

[etechjc]

We are 44K or so in CC debt over 4 cards, 1 my wifes and 3 mine. We went to see several lawyers today. One of the lawyers seemed very straight with us and said we shouldn't bother filing. He said that we were judgement proof with the house $20K underwater, Car several thousand underwater and our only income being exemp SSI and SSDI.

He told us that they were unlikely to sue us, Because we had no assets and (This part isn't completely clear to me) all the debts were well over the $5K small claims limit. He said that we should put some cash aside every month and retain him if they ever due sue, Otherwise told us that after a year or so consider using the cash on attempting to settle the debts with what ever collection company has it at the time for alot less.

The questions I have are, does this ring true? If so what is better for my CR, A BR with all the debt discharged or several collections showing up on are report with possible settlment? What did he mean when he said small claims limit, This didn't really make much sense to my wife and I? I think we left his office more stumped about what to do then when we went in...

[blessed]

What did the other attorney say? Your income can't be garnished so I would believe the guy.

Are you planning on using credit for anything in the next couple years? If you want to go to a cash system I wouldn't worry about which is worse for the credit score. IMO the best thing you can do is to stop using credit anyway, but that's just personal preference.

[WhatMoney]

We are 44K or so in CC debt over 4 cards, 1 my wifes and 3 mine. We went to see several lawyers today. One of the lawyers seemed very straight with us and said we shouldn't bother filing. He said that we were judgement proof with the house $20K underwater, Car several thousand underwater and our only income being exemp SSI and SSDI.

He told us that they were unlikely to sue us, Because we had no assets and (This part isn't completely clear to me) all the debts were well over the $5K small claims limit. He said that we should put some cash aside every month and retain him if they ever due sue, Otherwise told us that after a year or so consider using the cash on attempting to settle the debts with what ever collection company has it at the time for alot less.

The questions I have are, does this ring true? If so what is better for my CR, A BR with all the debt discharged or several collections showing up on are report with possible settlment? What did he mean when he said small claims limit, This didn't really make much sense to my wife and I? I think we left his office more stumped about what to do then when we went in...

You have a real knack for posting in the wrong forum, LOL.
"General Talk - Everything NON-bankruptcy related"
You want to be in the General Bankruptcy Forum.

Anyway I agree with the lawyer. What are you trying to protect? You might still get a lawsuit with your home ownership, depends on what they know about it - but they can't take an underwater asset. You'll need to deal with that separately.

It's cheaper and easier for collectors to sue in small claims court - which is why the "sweet spot" for CC lawsuits seems to be in the $500 to $4000 range. They also realize the larger your debt the less likely you will be able to pay it back, and are more likely to use BK to discharge it.

[etechjc]

Im really sorry, My vision is kinda bad, Why I receive SSDI. I thought I read General Bankruptcy, Ill try to pay closer attention in future posts. Really seems backwards that having a higher debt would make it less likely to sue.

As far as what I am trying to protect, I hope to get passed the hurdle and have some equity in the house and truck someday. Especially the house, Since Want to leave it to the kid someday.

And blessed, Personally I agree with you, However, I do have one vice that requires some credit. Every 10 years or so, I like to get a newer car or truck. As far as Cards go, I haven't actually used a CC for purchasing anything in about a year.

[etechjc]

I should also state that I hope someday to be employed again. I can't beleive that I haven't had any luck finding another job thusfar. I mean I have years of experienc and am Certified Auto Mechanics including Diesel Engines, Experienced and certified at all MIG, TIG, OA, Welding, Experienced Heavily Certified Computer Tech and Network Tech, Experience with Hydraulics and small engines among many other things. And yet, Not a single reasonable reasonable job opening. Heck, Im tempted to go apply at Wendy's just to have something to do... Very frustrating... Ill shut up now, lol.

[nc73]

My neighbor is a mechanic and he's still looking for work. It is tough I gotta say.

[etechjc]

Yeah you would think that with all these new automotive regulations we would be more in demand. Fortunatly I get to make a few bucks here and there on the side from people who know me and want me to work on there car.

Heh, I had a collection call from BOA today, I made the nice lady an offer that if BOA will employ me they can garnish 50% of my checks. She didn't know how to take that. All she said is "Ill note that on your account" we had an aquard silence moment then and we hung up. I think Ill start making that offer to all the collectors that call, lol.

[etechjc]

Ok can someone answer this, I read somewhere that "According to Federal Law, if money in a bank account belongs to an exempt status, such as Social Security, SSI, veteran's benefits, civil service retirement pensions they can't be garnished. (This applies to me)

So say I get sued and judgement is issued. My house won't be above water until long after judgements and account go away. Based on depreciation and kbb retail values my truck won't be above water for at least 2 more years and I will probably never sell it. The only thing I am really worried about is dipping there hands into my already lacking bank account. My sole income into this account is SSI, SSDI. And I guess if they want em, They can have my meager tax refunds. How and when do I make sure the courts know that exempt funds are in the account?

[WhatMoney]

The only thing I am really worried about is dipping there hands into my already lacking bank account. My sole income into this account is SSI, SSDI. And I guess if they want em, They can have my meager tax refunds. How and when do I make sure the courts know that exempt funds are in the account?

The best time IMO to tell a creditor your income is exempt and you have no non-exempt assets is before they sue you. That could happen if they send you a letter saying they are "thinking" about suing you, and are giving you a chance to pay up. Send a Debt Validation letter and also tell them about your "judgment proof" status, including exactly why they would get nothing from you if they sued you. If you truly have no assets for them to take, they will probably not be interested in a lawsuit that yields them nothing but more court fees.

If you are sued and they try to garnish your exempt bank account income, you send the court and creditor attorney an exemption claim to stop it. This is what your attorney is talking about - but you don't need an attorney to claim an exemption.

You are worried about a lawsuit when it may be way too early to even think about it. Who is after you, original creditors or buyers of junk debt? Again, not enough information to say much more.

You need to know all your State exemptions for judgments. You need to know what your vehicles are worth at auction prices, and if they have enough equity to make them worth seizing after a judgment. I'm not going to even think about your home - not enough information and others can help advice you there.

And since you appear to NOT be a bankruptcy candidate, I suggest this post be in the Collections thread. Few of the regulars bother with this forum. There is a lot to learn, whether you decide on BK or a cash basis protection lifestyle.

[junker]

one thing to remember with these jdb,s and collectors..is they WILL sometimes take your money even knowing it is exempt....and make you do all the work to get it back....even though you will probably get it back....it CAN cause a great inconvenience to you at the wrong time.....have you looked into getting the debit card from social security? i have one and it works GREAT....dont have a bank acct, so nothing to garnish...you can pay any bill with it.....it could save a lot of hassle.....

[etechjc]

You are worried about a lawsuit when it may be way too early to even think about it. Who is after you, original creditors or buyers of junk debt? Again, not enough information to say much more.

You need to know all your State exemptions for judgments. You need to know what your vehicles are worth at auction prices, and if they have enough equity to make them worth seizing after a judgment. I'm not going to even think about your home - not enough information and others can help advice you there.

Well, I am 30 days past due on 1 of my CITI accounts and my BOA acount, The other 2 citi cards are still current. It is still the OC after me, However, I have been reading thru the forums and kinda browsing thru the civil judgements only in my county and it looks like both Citi and BOA have a history of suing instead of sending it goto collections for all kinds balances. One of the balance in the civil records I saw for CITI, A guy was sued for $63K and they won thru default judgement. Also alot of them are requestion summary judgement.