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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Bankruptcy Law
Satisfied Customers: 111525
Experience:  Attorney At Law handling education matters.
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, I am thinking about Chapter 7 or 13. I have over

Customer Question

My name is Shing,
JA: Thanks. Can you give me any more details about your issue?
Customer: I am thinking about Chapter 7 or 13. I have over $1.4M house debt for two house, one is under my name now and the other is on my ex-wife. I still have over $30k back taxes and penalty all due to my ex gambling habit. I heart that by filing bankruptcy, I can get relief on the tax over 3 years old and second mortgage. I have remarry last year. How can I protect my new wife's property from creditors when we live in the community property state of California. Thanks
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Submitted: 10 months ago.
Category: Bankruptcy Law
Expert:  Phillips Esq. replied 10 months ago.

Your wife's property acquired before the marriage is her separate property and would not be reachable by your creditors. It is prudent not to co-mingle the property with yours and to keep her property separate from yours, keep separate accounts, etc.

Customer: replied 10 months ago.
as long as we keep separate account, file tax separately, and own separate properties, then hers will be OK.
Expert:  Phillips Esq. replied 10 months ago.

Yes

Customer: replied 10 months ago.
Thanks for that. As state before, I have $1.4M mortgage debt most of belong to the house under my ex-wife. How ever, she cannot refianance and my name stuck in those loans. What is the best way to file bankruptcy?
Expert:  Phillips Esq. replied 10 months ago.

I did not address the bankruptcy issue because you did ask any question regarding it.

If your debt is $1.4M, you cannot file for Chapter 13 because your debt would is too much for a Chapter 13. Any individual, even if self-employed or operating an unincorporated business, is eligible for chapter 13 relief as long as the individual's unsecured debts are less than $383,175 and secured debts are less than $1,149,525. These amounts are adjusted periodically to reflect changes in the consumer price index.

You can file for Chapter 11 if you want to save the house. Otherwise,you can file for Chapter 7, which is a liquidation Chapter if you do not want to save the house and if you meet the means test.

Click on the link below to see the current income guidelines for your state:

http://www.justice.gov/ust/eo/bapcpa/20151101/bci_data/median_income_table.htm

Customer: replied 10 months ago.
Since I am not on title, I have no risk of losing my ex-wife's house if the loan payments are not made. So that loan is not considered secured debt or my debt. The secured debt under my name is only $460k. Under that situation, can I qualify for Chapter 13?
Expert:  Phillips Esq. replied 10 months ago.

The loan is still secured whether or not under your name. Also, because you live in community property state that debt may still be considered yours if the property is not your ex-wife's separate property. If it is her separate property, then you can qualify for Chapter 13 if your secured debt is only 460k.

Customer: replied 10 months ago.
would the property be her separate property if only her name is ***** ***** title and she pay for the two loans for the house.
Customer: replied 10 months ago.
Here is my math:
House value: $920k
mortgage: $460k
IRSbacktax: $310k
others:$5k
Net asset: $155k
Can I still file for bankruptcy? On both Chapter 7 and 13 the homestead max exemption is $125k. So does filing bankruptcy help me or protect my house? I have struggle for the mortgage payment and Child support. When IRS comes to collect, I won't be able make ends mean.
Expert:  Law Educator, Esq. replied 10 months ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
We cannot make calculations for you, but yes, if your unsecured debt is only $460K it is possible to qualify for CH 13. Property that does NOT have your name on it is not considered your property. So if only your ex's name is ***** ***** property, it is her property. The child support cannot be extinguished in bankruptcy and most times the IRS or any other government debt cannot be extinguished or lowered either, but your other debts can be restructured (CH 13) or eliminated (CH 7) which gives you more expendable income to pay those other debts.
Customer: replied 10 months ago.
does my name on my ex-wife's house loan still considered as my secured loan?
Expert:  Law Educator, Esq. replied 10 months ago.
Thank you for your reply.
NO, if the loan is in your ex's name and the house is in her name it is not your debt, it is your wife's debt. If the loan has your name on it and your name is ***** ***** on the title, then yes it is still a secured loan.