Motorcycle as a second vehicle?

[mydebtsucks]

Thank you! I am in semi-panic mode and perhaps too sensitive right now anyway. I have so many questions...This is all just overwhelming and I am getting grayer over it!
One other question - If I find a really cheap place to live, do they use the actual price I pay for rent or does everyone across the board get the standard deductions from the IRS for your county?
I have really got to start saving after this is all over.

[SinkingFast]

We got grilled about our rent by more than a couple attnys. We pay in rent way more than the Schedules allowable for the Means Test. I figure the reason is, we could have an expensive place for filing BK, then go someplace significantly cheaper. Not really.

When we first started out we'd planned to stay in this house 2 years for our girls to finish High School. But plans changed. The composition of our family is such that, by law, we have to have a 4 BR place. 4 BR's don't come along often and they aren't cheap. We currently pay $1400/month rent. The rent range for 4 BR's here is $1200 to $1500. So that's not a significant pricing difference one way or the other.

Don't go cheap cheap on your rent prior to filing. When you get out and shop around a bit, you may find the cheap cheap apts aren't very nice. That's what we went thru when we were hunting for hubby's apt. Hubby had to move on ahead of us. In looking on-line at ads in the Newspaper, I thought he could rent for $350/month. That was until we saw those apts. Most of those cheaper rent apts were college student complexes. What mature, adult man in his right mind wants to live in weekend party city??!!

Pick yourself a nicer place to live. Someplace you are comfortable security wise, and won't mind calling home for a while. Don't go to the most luxurious apartment complex in town or anything like that. Find something mid range. That'll establish your rent range for the BK. And have a valid reason for choosing that particular place. Security. Handicap accessibility. Whatever that reason is. Let the Court believe that you intend on staying there for quite some time to come. Know the rents of comparable apartments so you can say if I were to move to "XYZ Apt Complex the rent would be $ABC/month as well. And if I rent a 2-3 BR house, it's gonna cost me so much money/month. Know your rental market so you can tell them you'll be spending approximately the same whether you stay where you are or if you move.

The BK Court isn't only looking at recent past, they are projecting out as well when they consider your living expenses.

[mydebtsucks]

Okay, so what you are saying is that they look at my actual rent and not the standard deductions?

[SinkingFast]

The Means Test will be the Schedules allowables. Schedules I and J will be your actual income and actual expenses. Sorta.

Your actual rent will be used on J, but you may be asked to explain why you rented such and so place for $700 rather than spend $350 (what ever base rent is in your area) to live elsewhere. We got grilled about our rent by attnys. Why so high. We have older teenagers and an elderly parent living with us. How much longer did we anticipate needing such a large home.

Attnys know what the Court expects to see in some areas, and that's all the attnys will submit. Like where we live, the Court allows $100/month on Schedule J for entertainment. Doesn't matter whether it's a couple with no kids, or a couple with 4 kids, the entertainment expense allowable is $100 max.

If you spend more for groceries than the Schedules allowable, you'd better have a dietary reason to explain the extra expense.

If you spend more for clothes than the allowable, you'd better be able to explain why.

There's an amount the Court is used to seeing in your area for drycleaning and laundry supplies. If you do a lot of dry cleaning to run that amount up, you'll have to explain why.

Wanted to add,............

In case you didn't see it, I sent you a PM. Upper right hand corner where it shows your user ID.

[no_it_all]

Referencing the original post, I have a question...If I was making 45K a year and owed 35K in CC and "owned nothing" why would I go BK?? I am pretty much judgement proof. Just walk...Credit card companies will just fade away in about six months...Thoughts???

[time4cake]

Referencing the original post, I have a question...If I was making 45K a year and owed 35K in CC and "owned nothing" why would I go BK?? I am pretty much judgement proof. Just walk...Credit card companies will just fade away in about six months...Thoughts???

I suspect the credit card companies would attempt to garnish your wages.

[no_it_all]

I dunno, I have never heard of a wage garnishment because of credit card debt..it would be too easy to stop it by filing BK. It is unsecured debt. Well, I take that back, I have HEARD of it, but never <actually> known anyone that had it applied to them. I think it is a big scare tactic.

[LostOne0069]

Credit card companies fade in 6 months? More like 6 years. At 6 months, most of them have just barely turned you over to collection agencies. If you're in a state where they can garnish wages, you're toast. Oh, and even if you ARE judgement proof. Forget getting ANY kind of credit during that 6 years. Getting a BK to legally wipe out the debt lets you "reset" the clock so to speak. Your credit starts improving from the very first day you're discharged. If you just walk away from the debt... your credit will just get worse and worse and won't improve until those debts actually charge off AND drop off of your report. I forget how long this takes but it's like 7 to 10 years.

Just "walking away" is a bad idea. Be an adult and face up to it and take care of it one way or another.

[no_it_all]

Credit card companies fade in a maximum of six months. At that point your debt has already been charged off and sold to a collection agency. The statute of limitations in most states for collecting on a credit card debt is well under six years. So, yes, they do just fade away! Some states it is as quick as thirty-six months. Note that some states it is six years. Again does <anybody> have first hand knowledge of the "wage garnishment for credit card debt" urban legend?? I personally know people that have walked from fifty, sixty and more thousand in credit card debt with no garnishment and not ever filing a BK....your mileage may vary!!

[LostOne0069]

Wage garnishment depends on where you live and your situation. If you live in a state where wage garnishment is allowed... say, New Jersey, then your creditors can sue you and, if they win, get a judgement that allows them to take up to 25% of your pay (this is the max that NJ allows, ymmv).

Credit card companies may fade in 6 months... but the collection agencies do not. They're going to keep reporting to the credit reporting agencies until they're not allowed to anymore and they're going to call you or maybe sue you for quite a while. Moving and not leaving a forwarding address can help avoid the calls and garnishment, but your credit is going to suck for a long time and won't improve until those debts get charged off or otherwise dissappear from your report.

[mydebtsucks]

I see what you guys are saying about the walking away part and the urban legend, but that idea scares me to death. I guess I am judgement proof in a way because I truly do own nothing but a few household goods and most af them are crap anyway. I know garnishments are not allowed in my state, but still...I think it is scary. I heard they can put something on you that say you are never allowed to own real estate. What is the statute for this kind of action anyways? I thought I read on here too that if you even speak with them, the statute is reinstated so to speak. And what if 5 years from now I found someone to marry. Can't they come back and sue me again saying I now have more money to pay?

[no_it_all]

Well, if your state doesn't allow garnishments you are looking good. I would check to see if there is anything they can do in lieu of the garnishment. If you want to buy real estate your problem will be that you will have a really crappy looking FICO for a long time (six-seven years maybe, I really dunno) and have to pay a higher interest. If you do go BK it appears (again, I dunno) that you will be looked at more favorably by a lender than someone with a ton of outstanding junk on their credit report...Nobody can stop you from buying or owning property so forget about that urban legend...BTW, these legends are clearly the best weapons bill collectors have! Like I posted, depending on what state you live in, these unsecured debts go bye-bye all by themselves in as little as thirty-six months. Then just tell the collectors that the SOL has run out and they will drop you like a hot potato..I just got a letter a few months ago from a collector looking for $21,897.00 on a Citibank Credit Card...Date of last activity was August 6, 1998...I <almost> didn't have the heart to tell the poor guy that the SOL had run out.........

[no_it_all]

<snip>
but your credit is going to suck for a long time and won't improve until those debts get charged off or otherwise dissappear from your report.

Without a doubt that is the biggest reason for not just walking......

[Minnymouth]

A NOTE -

If you "walk away" from your debts hoping they will disappear in the future.............

THEN be prepared to go to court, hire lawyers, expect wage garnishments, loose you job if your company sees fit, never be able to purchase much of anything ever again for a long time on credit....

Companies can get a judgement against you in court, thus keeping it on your credit report forever (all they have to do is reinstate it).. THEN if you ever purchase property/home/auto in the future they will slap a lien against it...... and its their's until you pay the debt......

Judgemental liens do NOT GO AWAY...... only a Court battle (expensive) can get rid of them.....

Soooooo, your better off in the long run of just filing bankruptcy, eliminating all the debt and getting on with your life...... WALKING AWAY can be very expensive in the future (a lot more than claiming bankruptcy) and cost you a lot the rest of your life......

WORTH IT????????????

If you think you can "beat the system" - good luck!!!

Minny

[mydebtsucks]

oh i agree. I would NOT do this. I would feel like I was "on the run" forever. I don't want to go into "hiding" just because I bought one too many pairs of jeans.