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VanDLaw
VanDLaw, Attorney
Category: Bankruptcy Law
Satisfied Customers: 833
Experience:  Chapter 7 & 13
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I AM IN DESPERATE FINANCIAL CONDITION. MY SALARY WAS CUT IN

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I AM IN DESPERATE FINANCIAL CONDITION. MY SALARY WAS CUT IN HALF AND I AM IN FORECLOSURE. I CAN NOT PAY CREDIT CARD DEBT. MY CAR IS UPSIDE DOWN. SHOULD I CLAIM BANKRUPTCY OR PAYMENTS IN DEFAULT? I HAVE ONE BANK WHO SERVED ME A SUMMONS BUT I HAVE NOTHING TO OFFER. ALSO, IS IT SAFE TO PUT AWAY ANY CASH IN A SAFETY DEPOSIT BOX? CAN THE BANK GET TO THAT? THANK YOU!

If you have been served a summons you have 20 days to respond/answer. You should definitely take the summons and discuss your financial situation with an attorney who specializes in foreclosure actions. It may be that you just let the foreclosure go through, but you should have all your options before doing that.

 

As for filing banruptcy, you can do this and surrender the home, credit card debt will be discharged, and you can choose to reaffirm (keep) your car if you choose too. If the car is paid off you have an exemption of $1000.00 that cannot be taken by the bankruptcy court for a vehicle. Any money that you have, even if it is in a safety deposit box must be listed on your bankruptcy schedules. To conceal the money is fraud upon the Federal bankrutpcy court. No one is going to physically come in and get that cash, and the bank cannot attach it until they receive a deficiency judgment. The deficiency judgment is the difference between the amount you owe on the note and the amount they get at auction for the house. This is a separate action, and while they have the ability to seek a deficiency judgment it is not being sought on a regular basis by the banks as they just have too many to keep up with at the moment. This doesn't mean they won't however.

 

You should also seek a bankruptcy consultation, if you have the ability to make regular payments, you may be able to file a Chapter 13 which is a repayment plan of 3-5 years which would stop the foreclosure and let you get caught up with your mortgage payments. Credit card debt is rolled into this plan as well, and at the end of the 5 years your credit card debts are discharged and you are back on track with the house payments.

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