Consumer Protection Law
Consumer Protection Law Questions? Ask a Lawyer Now.
Hi - my name is XXXXX XXXXX I'm a Bankruptcy and Consumer Protection attorney here to assist you.
No one is fond of filing Bankruptcy.
But sometimes a Bankruptcy is the only feasible solution when one's debts are overwhelming.
If you file a Bankruptcy, you will be able to "start over".
Do you have any questions about filing a Bankruptcy?
Hi Chris, Thank you for your response. Yes, we have questions regarding bankruptcy. What type of BK do we file? We do not want to lose our business, so I guess an 11 or 13 would be the only way to go? Also, we must maintain at least one credit card in order to process orders for clients. How does this work. Also, how will this affect our ability to purchase/lease new equipment as needed for replacement? Thank you for your response.
Are you online? I think that this website is having issues. We really look forward to your response asap.
Chris, As mentioned in my first posting, we lost our home in 2008 from a hurricane. Also, I mentioned that we DO NOT want to lose or sell our business, if at all possible. The mortgage balance is about 220,000 and it appraised for 345,000. a few years ago.
And does your business have equity?
In other words, can your business be sold and/or does your business have assets/property that can be sold?
If yes, how much could your business and/or business assets be sold for (after deducting any loan(s) that are secured by the business and/or business assets)?
Thanks Chris for your prompt reply. The property can be sold, but by the time the debt against assets are calculated we might be lucky to have 75,000 in assets, and that might be pushing it.
Thanks Chris, well that is good news. It seems like a no brainer except that our credit will be trashed for quite a while. Since the banks are not loaning with good credit at this time anyway,, maybe it doesn't matter. I forgot to mention that we also have a truck payment of about 525.00. Do we have the option of keeping that if we can make the payment? Also, can you file if you are not behind on any payments just yet, or do you have to be in delinquent before filing? It is only a matter of time before we will be, as cash flow is less. One other concern, is that we do require at least one credit card to process orders for my wife's business? How would that work. I apologize for the lengthy questions, but we really appreciate your help.
Chris, we will look that up and get right back to you. Also, when you have a minute, could you address my other questions listed in the last posting regarding the need for a credit card for my wife's business, and the fact that at the moment at least, we are not delinquent on bills. Also, do you handle Texas BK? Thank you so much, you are appreciated!
Chris, oh I wish you did practice in Texas! May I ask how you know that the total fee is only 100.00 (or 200.00) if we keep the truck? I am not questioning you, please understand, just trying to figure out how we arrive at that number. Also, are you allowed to keep at least one credit card if you don't include that account in the BK? Thank you again.
When you file a Chapter 13, you must give the Bankruptcy court - over a period of 5 years (60 months) - the total amount of the value of your non-exempt assets.If your business can be sold for $75,000, the non-exempt portion would be around $10,000 (after subtracting an available $60,000 exemption, and $5,000 cost to sell the business).This means you would have to pay $10,000 over a period of 5 years. As $60,000 is the total exemption available for personal property (since your business is a sole proprietorship, its assets are considered to be personal), you would also have to pay the value of the truck's equity over a period of 5 years.By the way, if you are wrong about how much your business could sell for, and if it could only sell for around $60,000 after subtracting the business loan, and if your truck has little or no equity, then you may be able to file a Chapter 7 instead.With a Chapter 7, you would not have to pay anything (no monthly payments) to have your credit card debt discharged. Your Bankruptcy will be able to arrange to have your business professionally appraised to determine whether you should file a Chapter 13 or a Chapter 7.
Thank you Chris for taking the time to type this lengthy answer. In a Chapter 7 don't you lose the business period? I guess I am confused. I again apologize for taking so much of your time. FYI, the truck has about 9800.00 equity.
You would be able to keep the business and the truck if you file a Chapter 7 if the total equity for both is less than $60,000.If the total value of the equity for both is a little more than $60,000, you should be able to pay the difference to the Bankruptcy court over a period of around 4-6 months (the average length of a Chapter 7) - to be able to keep both. Since you already know how much equity your truck has, I think the most important thing for you to do is to find out how much your business can be sold for.
That is very interesting information. What is the best way to determine how much the business could be sold for? I feel sure that if you contact a real estate agent, they are going to go for top dollar. Also, can the court force you to sell you business? Thank you Chris, you can be sure that I am going to give you an "Excellent" rating and a tip!
Thanks Chris, Ok, then can they force you to sell under a chapter 13?
Ok, again that is good news. Chris, did you see my question about keeping one credit card if we did not include it in the BK? Is that possible? I promise I am almost through asking questions!
You are not allowed to exclude any credit card from your Bankruptcy filing. You must include all credit cards in your Bankruptcy.However, even if you "forgot" to include one credit card, you would still not be able to keep that card, as all credit card companies are able to find out that their customers have filed a Bankruptcy - even if their card was not included - and they immediately cancel the card as soon as they find out.Credit card companies are able to get this information from the credit bureaus, who are able to get Bankruptcy filing information directly from the Bankruptcy courts.
This is why I suggested that you use consider using a debit card (or perhaps you know someone who will allow you to be an authorized user on their card).
Ok Chris, I really appreciate all of your help. If I have any further questions, is it possible to get back in touch with you?