Should I or Shouldn't I?

[nmocean]

I have been thinking of the same thing my wife has ran up credit cards, I returned to complete my college so I have student loan debt and some of the college was put on credit cards as well. At the same time to save my job that I had I transferred to another plant and took a 50% pay cut. My wife also a few months later took about a 40% pay cut. Our bills have remained the same as we were making the higher salary. I have done everything that I could, I refinanced the house and cut the payment by 475.00, I then sold my boat which was paid off and used that money to pay off my truck and used the left over to pay down some of the credit cards. My wife went into credit counseling, but with the pay cuts and bills we are sinking slowing. We went to a lawyer in July and talked to them about this but did not file, I am kind of waiting around for a lawsuit settlement when I was involved in a car accident two years ago which should be rather large. How bad is it after you file, are you able to buy anything on credit, such as a car, truck, boat etc.

[tobee43]

since i don't know the details of the lawsuit you are talking about, i would check with a BK atty to see what type of liability you are talking about here.

if it's a situation where you were at fault (which i'm just using as an example) or not would most likely help determine the final outcome.

many of us on this site have experience much of what you are going through. however, at some point, when we have sold all our assets to continue to live in a life that we had good jobs, we found it was throwing good money after bad. actually, we couldn't met our general financial obligations after we both lost our jobs.

remember many of these so called agencies that do credit counseling get a piece of the pie. i.e. if you have a 10k card that they negotiated to 5k...you'd still have to pay them 2k for just taking your money. many of them wait for you to make numerous payments before they will even attempt to negotiate your case. in the mean time you're credit is going down and down and down, but they have a good chunk of your money and now you know you or realize you have gone no where.

making the decision to file bankruptcy is a personal business decision. one you need to sit down and thing about carefully. for many it's a new lease on life. also not knowing about your accident situation where you may get a settlement and you filed, it could present problems for you.


best of luck to you!

[nmocean]

Yes the lawsuit is for me, I was involved in a bad rear end collision while sitting at a red light. My car was totaled and I was off work for 4.5 months with 6 ruptured discs in my lower back and neck. We already had depositions etc. my lawyer says they don't want to take it to court etc. If I file bankruptcy (which I have been trying to avoid) any offer from the insurance company, the trustee might accept it, even if it is a low ball offer. So we have been barely hanging on.

[tobee43]

Yes the lawsuit is for me, I was involved in a bad rear end collision while sitting at a red light. My car was totaled and I was off work for 4.5 months with 6 ruptured discs in my lower back and neck. We already had depositions etc. my lawyer says they don't want to take it to court etc. If I file bankruptcy (which I have been trying to avoid) any offer from the insurance company, the trustee might accept it, even if it is a low ball offer. So we have been barely hanging on.

i understand, it's really like being between a rock and hard place. my general understanding is, a creditor may not take your personal injury settlement if the state deems that the award is for you to continue living life as usual. however, state exemption laws exist, also called bankruptcy exemption laws, allow a creditor to take part of your settlement up to the specific exemption amount depending on the type of debt that is owed.

i would also be mindful of possible tax ramifications court settlements are legally complicated areas when tax time comes. some settlements count as income while others do not. those counted as income are taxed at the same rate regular wages and salary will be. if you have just received a court settlement, don't neglect to claim the settlement on your taxes if you are legally required to.

i would really run this by your atty. also, hopefully some of our resident attys and mods may have a different perspective that may help you more.

best of luck and keep posting there are many here to help..and i'm a little late but welcome to the forum.

[nmocean]

the attny. stated that 40,000.00 could be protected. so all of it won't go to the trustee. but say if the insurance company makes a low ball offer the trustee can take it and put it towards the debt which I have no problem with as long as it was a fair offer for me.

[nmocean]

Maybe I should ask this, when this settlement comes through, and after everything has been paid on that side. The left over money goes to the debt. If the leftover money exceeds the debt and I get the left over is the bankruptcy over? Lets say they have me a a five year plan, the case settles within a year, the money is paid to the trustee who pays off the debt in the bankruptcy, is the bankruptcy now over?

[tobee43]

i would really ask you atty these questions, as your state may have certain laws that may apply as i have stated above. again, it's like being between a rock and a hard place. if you don't really care where the money goes maybe it will be enough to catch up all your debts and you will not have file at all. that may be something you may want to think about as well.

[nmocean]

I talked to my attny he said they are wanting to settle so I am just going to try to wait it out and I might not have to file at all hopefully. I sure would hate to file then a week later come into some money

[LadyInTheRed]

Maybe I should ask this, when this settlement comes through, and after everything has been paid on that side. The left over money goes to the debt. If the leftover money exceeds the debt and I get the left over is the bankruptcy over? Lets say they have me a a five year plan, the case settles within a year, the money is paid to the trustee who pays off the debt in the bankruptcy, is the bankruptcy now over?

Yes. Once your debt is paid, your BK would end.

[ScoobaSteve]

Today is the day I meet with a lawyer for the first time. A little nervous

[tobee43]

Today is the day I meet with a lawyer for the first time. A little nervous

just take a nice deep breaths, and don't drink 12 cups of coffee....go into "zen" mode and you'll just do perfect. make certain you let us know how you make out. i'm sure you'll do just fine best of luck, it will all work out.

[ScoobaSteve]

This lawyer told me I didn't need to bring any sort of documentation with me. Just my general knowledge of my salary and how much I owe in CC debt is sufficient for this consultation. But I have written out a breakdown of my monthly expenses versus my monthly income, as well as a handful of questions I have thought of.

One question I do have and I looked around a bit on the forum but didn't find an answer: My car is 6.5 years old and has almost 90K miles on it. It's not something I will be able to keep for 5+ more years. Is it smarter to buy a new car now, while I still have good credit and can take advantage of a low or 0% APR? Is buying a car just before filing even an option? I'm just worried that in 2 or 3 years, I'll try to buy a new car and have to pay 10% interest on it.

[helpmeout]

I would bring the info with you anyway. It's easy for one's mind to go blank when nervous.

[LadyInTheRed]

One question I do have and I looked around a bit on the forum but didn't find an answer: My car is 6.5 years old and has almost 90K miles on it. It's not something I will be able to keep for 5+ more years. Is it smarter to buy a new car now, while I still have good credit and can take advantage of a low or 0% APR? Is buying a car just before filing even an option? I'm just worried that in 2 or 3 years, I'll try to buy a new car and have to pay 10% interest on it.

It is very common to buy a car before filing a Chap 13 so that you have a reliable car to get you through the plan. The payment should be kept reasonable and not put you in a position where you don't have enough dmi to propose a feasible plan. But, if purchasing a car would make it difficult to propose a feasible plan, it might also help you qualify for a 7.

I bought a car about a month before filing. The $300 car payment is part of my plan payment. If I hadn't bought the car, I'd be stuck with a 1999 gas guzzling truck and the $300 a month would have gone to my unsecured creditors.

Every situation is different. Ask the attorney how buying a car would effect your BK.

[ScoobaSteve]

Met with the lawyer. He was very nice and not pushy at all. He laid everything out for me. It was all the stuff I had learned from coming here and other internet research. My case would be a very simple Chapter 7 since I have no property and no assets worth selling. He quoted me a price of $2,400. Is that reasonable?