Need Advice

[df04527]

If you need a car...now is the time to get it as your credit scores will start to feel the negative impact 30-60 days from your first missed payment.

I feel your pain with a Fortune 12 company canning retiree plans. Sigh...not fair as we have no time left to make right the wrong of promising one thing and then backing out. Ugh

[nioka]

PJMax,

I am happy to hear you got something now you like.

I always get a kick out of those younger folks who are ranting that older people should work longer. They don't understand that we tried and they still threw us out. One thing for sure is that time marches on and sooner or later those young people will be old people. Let's see how they do.

I met with my attorney today. He pointed out a few things I didn't know but I was well prepared thanks to you folks. I wanted to hold back but he encouraged me to get the process started. I told him this bucks everything I have done throughout my life. He is in his sixties and told me he understands completely but in order to get protected I need to get started. He told me not to use my CC's anymore. I am in TN and he told me that I have a $10k exemption which I understand is fairly generous compared to many other states. One thing I did not understand is he said the HOA fees are not dis-chargeable but I would not have to worry about them. I will have to ask for an explanation next time I see him. He also told me that I probably can stay in this home for 5-6 months.

I assume I will have to continue to pay the electric and water bills.

I thought about trying to hang on but I thought this is probably going to be my last big fling. I think I will sell everything I can and after my BK will head out west for a complete change.

After I met with my attorney I felt exhausted. Maybe I can get a good night sleep tonight.

[AngelinaCat]

What you are probably feeling is a great weight off. You have gotten started! Get a good sleep tonight.

Yes, you do continue to pay your electric and water bills.

[nioka]

I have an 8 year old car with 140k on it but it runs OK.

I am concerned about a phone, a smart phone, capable of getting on the internet. I had one before and found it to be a real lifesaver. At the end of my contract I ended the service and switched to a Straight Talk phone to save money. Once I leave this house I will not have the internet and the area I want to go has limited service with Verizon being the sole provider. I thought it best to go back to a Verizon smartphone now before my credit hits the fan. Anyone have any comments?

dfo4527

Thanks for the info on the speed of credit reporting.

Besides my concern about getting an approval to rent a new property I am also concern about getting the utilities turned on. I think that if I continue to pay my electric, water, and phone a new electric company won't worry about the BK.

How have you resolved your housing and utility problems after BK?

[keepmine]

As to the HOA question- those fees that are due up until your bk filing are dischargeable. Post bk, if the home is still in your name you'll still be responsible for HOA fees.
However, there is nothing the HOA can do to collect from you since, all your income is exempt from levy.
Yes, you need to keep paying those utility bills if you continue to stay in the house even though you aren't paying the mortgage. As long as you don't include unpaid utilities in your bk filing, you should have no trouble getting service where ever you land.

[nioka]

keepmine,

After being cautioned on the HOA thing I looked up several case histories here in Tn. I learned there are people who post BK were still responsible for the HOA fees because the mortgage company had not foreclosed. These cases were typical of the results of the TN floods a short time ago. Several residents went back to court to argue that being held responsible for the HOA fees after discharge was not in the spirit of the BK laws. That seems to be ongoing.

You pointed out that my income is exempt from levy.

Question here is that if I continue to pay the HOA fees, $100 a month, along with all utility bills until my hearing and the mortgage company has not moved on foreclosure they I should be allowed to stay here until they do foreclose as long as I pay the HOA fees and utilities, correct?

There is also a second issue here I didn't think I needed to mention but now seems relevant. Without getting in the event I was threaten with a fine by the HOA for a violation I was not responsible for. If I fail to pay the fine then the HOA could get a lien and move on possession. Once they gain possession then they would become responsible for the HOA fees. True? So no matter whether the house is foreclosed on by the bank or the HOA sues for possession I would no longer be responsible for the HOA fees.

The utilities bring up another issue I didn't realize before. I had to install a new heat pump and it was financed by the utility company. The debt would be discharged at BK. Even with my utility bill paid until the Bk discharge how would that effect my getting electrical service elsewhere?

Thanks.

[keepmine]

I'd halt payments to both the mortgage and HOA and stop worrying about what they may/or may not do. End of the day, they can't do anything to collect.

Including that debt to the utility company shouldn't affect won't affect your getting service from another utility.

[bcohen]

Question here is that if I continue to pay the HOA fees, $100 a month, along with all utility bills until my hearing and the mortgage company has not moved on foreclosure they I should be allowed to stay here until they do foreclose as long as I pay the HOA fees and utilities, correct?

You can continue to stay in the house WITHOUT paying the mortgage, HOA dues, HOA special assessments, HOA penalties, etc, until and unless the bank (or possibly the HOA) forecloses. Once the house is sold, you will then have a short time (30 days, I believe) to find an apartment and move.

[nioka]

bcohen

Thanks again.

The attorney I talked to was anxious to get started with my BK. He said that once I retain his services I am protected. However he did say that the HOA fee would not be discharged. Wouldn't it be better to wait until either the HOA or mortgage company foreclose before filing or doesn't it matter?

I am also confused on the safety of my income. I get SS and a small pension. Both the SS and pension are direct deposited in the same checking account. I have read my SS is protected. I have also read that because the pension is also deposited into the same account it is also protected. The attorney I talked to did tell me not to deposit any other checks or cash in that account.

What other methods is there for storing cash other than keeping cash on hand? I was thinking buying prepaid CC might be an answer.

[keepmine]

You seem to be manufacturing things to worry about.
Your lawyer is just plain wrong. HOA fees that are owed prior to filing may be discharged.
Why worry about post petitionn fees when. your income is exempt from seizure?
We're trying our best to tell you how to survive post bk and that means, stop paying all debt that you'll either discharge or never have to pay and save your money and use that for dental work, moving expenses, hh expenses, etc.
Your creditors are really powerless given your situation.

[nioka]

keepmine,

Sorry, you are absolutely right I am worrying about things I should not and you all have been very supportive. I am able to get to sleep until 0400 then I wake up with a big "what if." The worst thing for me is this is a holiday weekend and I cannot contact anyone.

Monday I will look for another attorney.

[Pjmax]

Nioka, that is why we've recommended seeing a few attorneys, 3-5 is a good number. You may get slightly different advice from each one you speak with. Talk to some more, and in the end, you choose the one you are most comfortable with and gives you good solid advice that is consistent with what you've heard here.

We all worried like crazy until discharge, but in the end, for most of us, it was a piece of cake. Get some sleep!

[bcohen]

The attorney I talked to was anxious to get started with my BK. He said that once I retain his services I am protected.

No sh*t. The attorney is in the business of selling his services, and like any other good salesman, he wants you to hurry up and buy, rather than keep thinking about it.

However he did say that the HOA fee would not be discharged. Wouldn't it be better to wait until either the HOA or mortgage company foreclose before filing or doesn't it matter?

HOA charges--including monthly dues, special assessments, and fines/penalties--which become due before you file for bankruptcy will be discharged as to you personally. (The HOA can, of course, still place a lien on the house for those monies, however since you don't plan on keeping the house, that's not your problem.)

The problem which many homeowners are discovering is that even after filing for bankruptcy and "surrendering" the house, and moving out, the HOA dues, special assessments, and fines which become due after the bankruptcy filing date remain a personal liability until and unless the bank takes possession of the house. Many HOA's are extremely aggressive in collecting these monies, and will not hesitate to sue the former homeowner and try to garnish wages/bank accounts for the debt, and since the bankruptcy is over, the person has no relief. That is why the consensus here is that if you are planning to surrender the house, or lose it to foreclosure, then DO NOT FILE FOR BANKRUPTCY UNTIL AFTER THE HOUSE IS SOLD! Then you will be able to discharge any and all debts related to the house.

I am also confused on the safety of my income. I get SS and a small pension. Both the SS and pension are direct deposited in the same checking account. I have read my SS is protected. I have also read that because the pension is also deposited into the same account it is also protected.

As long as you keep only exempt funds in the account, and file a notification form with the bank telling them that the account contains only protected funds, the law says that they cannot allow a creditor to levy that account. This is not automatic, so you have to file the appropriate form to put the bank on notice that this account contains only exempt funds!

[nioka]

bcohen,

Thank you for the info. I am waiting for Monday and my next meeting with an attorney. Money I will also check on that exempt money in my bank account.

It makes sense about waiting for the bank to foreclose. It also makes sense to me to keep paying the HOA fees. I guess that if I cannot have the $1200 fine remove I should even pay that so the HOA cannot foreclose. One question I have is that if the HOA forecloses wouldn't they become the new owner and stop my liability for the HOA dues?

I had one bit of good news in that I called a senior apartment complex and explained I would be filing for bankruptcy. They told me I would have to wait until my bankruptcy was discharged but the fact that I was bankrupt would not matter. Big relief for me.

The one thing that pushed me over the financial edge was a neighbor complaining to the HOA because I took down a tree that was threatening my house. HOA solidly backed her and fined me $1150. (That was the straw that broke the camels back). Anyway, I just learned that a few days ago they carted her off to a padded cell. She is in her 80's and lost her husband a few months ago. She is gone and because of her I am in a battle with the HOA causing me to go under. I spoke with a person on the HOA board who is going to try to have the fine removed. If they do remove the fine I am still at the end of my finances and I wonder if I should just go ahead with the bankruptcy regardless.

BTW, since I got screwed by a HOA I read several cases where HOA residents were also fouled. According to some of the articles HOA's have been taken over by corporations with attorneys on staff. They deliberately seek out violations were they can charge fines and when the resident cannot or refuses to pay those fines have a super lien placed against their homes leading to a foreclosure. There are some documented cases were residents were foreclosed on owing as little as $350. It makes me wonder whose side our legislators are on. The point here is stay away from HOA's.

(I must apologize because I feel like a real dummy when it come to BK with HOA fees and fines).

[bcohen]

I will repeat this again: If you are planning to keep the house, and pay the mortgage, then you should continue to pay the HOA dues and penalties. If you are planning to stop paying the mortgage, and lose the house to foreclosure, then DO NOT PAY A PENNY MORE TO THE HOA. You have nothing to gain by paying them. The HOA is not going to foreclose on a house which already has a mortgage, because they cannot get clear title without paying off the mortgage lien, which would not be profitable for them. Once the bank eventually forecloses, then you can file for bankruptcy and dump the debts.