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A.J.
A.J., Attorney
Category: Bankruptcy Law
Satisfied Customers: 4282
Experience:  Experienced consumer bankruptcy attorney.
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I have home. Loan $135,000. Zillow show $163,000. I do hace

Resolved Question:

I have home. Loan $135,000. Zillow show $163,000. I do hace pick up truck $12,000
My wife would like to file Bankruptcy by her-self.
To file Bankruptcy looks like better to use 704.

In California Bankruptcy Section 704.060 Personal property used in spouse's common trade... If on car title debtor's and spouse's name, and only wife file bankruptcy and pick up track use by husband in self-employed construction business, may I use section 704.060 for car exemption? Is self-employed the same meaning as

Personal property used in debtor's and
spouse's common trade, business, or
profession (amount of exemption for
commercial motor vehicle not to exceed
$9,700)
But it is said "common business". My wife not self-employed and she is dental assistant. I am in construction business.
Can I use 704.060 for my pick up truck?

Thank you
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  A.J. replied 1 year ago.

SavyLawyer :

Hello, and thank you for contacting Just Answer. My name isXXXXX am a bankruptcy law professional and I look forward to answering your question today. Give me just a moment to review your question.

SavyLawyer :

704.060 as written should be applicable to any tool of the trade or commercial motor vehicle.

SavyLawyer :

The statute specifically says:

SavyLawyer :

704.060. (a) Tools, implements, instruments, materials, uniforms, furnishings, books, equipment, one commercial motor vehicle, one vessel, and other personal property are exempt to the extent that the aggregate equity therein does not exceed:

SavyLawyer :

(2) Six thousand seventy-five dollars ($6,075), if reasonably necessary to and actually used by the spouse of the judgment debtor in the exercise of the trade, business, or profession by which the spouse earns a livelihood

SavyLawyer :

So, the exemption amount allowed for a vehicle, or any other asset used in the trade by only one spouse is $6075, and would only be double that if both spouses use the vehicle for their trade.

SavyLawyer :

In the situation you are describing, where only one spouse uses the vehicle (or any other tool) for their trade, the exemption amount is $6075.

SavyLawyer :

While this would leave equity in the vehicle exposed, there are other exemptions, particularly the "wildcard" exemption that could be used to cover the remainder of the equity in the truck.

SavyLawyer :

In such a situation, where there are potentially exposed assets, I would strongly encourage you to work in person with an experienced bankruptcy law attorney to make sure that all of your assets are protected to the extent possible .

SavyLawyer :

For a referral to an attorney in California, the state bar association has a referral service that can be reached by phone at:

SavyLawyer :

1-866-442-2529

SavyLawyer :

I am sorry, let me just correct one thing. If you did choose the exemptions under 704 (As opposed to choosing under 703), then there is not a wildcard exemption, but there is an exemption available for up to $2550 in an automobile that could be added.

SavyLawyer :

This is where the debtor chooses to use the section 704 exemptions instead of the 703 exemptions.

SavyLawyer :

Have you already filed for bankruptcy and chosen which exemptions to use or are you still considering your options?

Customer:

Thank you. it is really helpful answer. But is it Wild car in section 704? It is in 703 only, I think. I afread to use 703 because of house equity. It Zellow show 163,000 and Loan amount 135,000, so it is 28,000 equity Is it covered under 703 section?

Customer:

No I have to file tomorrow and I think to use Wiled card and partially cover equity

SavyLawyer :

No, you are correct, the wild card exemption is not in 704, it is only 703, which is what I was trying to correct above. Under the 704 exemptions there is a vehicle exemption that can be used, as well as commercial vehicle used for trade, but not a wild card exemption.

SavyLawyer :

Are you working with an attorney to file? Why do you have to file tomorrow?

Customer:

Because it is set a court by one creditor and I have to filee bankruptcy before 05.01.2013

Customer:

No I am doing bakruptcy by myself

SavyLawyer :

By "set a court by one creditor" do you mean a creditor has taken you or your wife to court?

Customer:

yes

Customer:

Just trying to set court againts my debt

Customer:

What I think if wild card cover 25,000 and car is 10,000-12,000 , so rest I can apply to home equity and 10,000 not exempt I think trustee will not follow for 10,000

SavyLawyer :

I understand, and having a creditor take action in court can be frightening. Ultimately, in choosing between each of the two exemption regimes, 703 or 704, there is a risk that the exemptions will not cover everything.

Customer:

yes it is my concern

SavyLawyer :

That is a real possibility. Unfortunately, it is difficult to know how a particular trustee will treat any specific amount of equity. With such a small portion of the equity of the home left open, it may be that the trustee will decide it is not worth their time or effort to try and seize the home as so little would be gained by it. However, there is certainly no guarantee of this. Ultimately, each trustee makes this decision for themselves, as to what is worth pursuing.

Customer:

But the car is Salvage and I will take price/value from the dealer today. It could go to $8,000. You are helpful. Thank you

SavyLawyer :

This is why it is worth consulting with an attorney in person in California, as they will often know trustees individually and how individual trustees will react in certain situations. This is, unfortunately, not something we can establish online.

SavyLawyer :

I understand, and I am glad that I could be of some help to you. Let me know if you have any additional questions. Otherwise, please remember to RATE my answer so that I can receive credit for my work.

A.J., Attorney
Category: Bankruptcy Law
Satisfied Customers: 4282
Experience: Experienced consumer bankruptcy attorney.
A.J. and 3 other Bankruptcy Law Specialists are ready to help you
Customer: replied 1 year ago.

Hello, when I entering Creditors On Schedule F I see in credit history of Credit card in Activity Description "Transfer/Sold and in Charge Off - $1,400Amount, do I have to include this creditor into Schedule F?


Specialy if it is said Transfer/Sold? Thank you

Expert:  A.J. replied 1 year ago.
That is a good question. Is there any indication on the credit history who the debt was transferred or sold to?
Customer: replied 1 year ago.

Bank of America Status: Charge OffActivity : Transfer/Sold , No name to whom sold

Expert:  A.J. replied 1 year ago.
I understand, thank you for the extra information. Generally, it is best to be on the safe side and list every creditor that could possibly still hold a loan. It is possible that the credit report is not up to date, as creditors do not always report every month to the credit reporting agencies. First, it is important to review the credit report to see if the debt appears anywhere else under someone else's name. If there is a debt on the credit report that is for an identical amount, but under a debt collector's name, that may be the debt. However, if there is no indication of where the debt has gone, and you have not received any information from a debt collector that they hold the debt, then listing the debt with the original creditor is all that you can do. Ultimately, debtors should err on the side of caution and, when in doubt, list the debt.

I hope this helps, and let me know if you have any additional questions or require clarification of anything that I have said. Otherwise, please remember to RATE my answer so that I can receive credit for my work.

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