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legalgems, Lawyer
Category: Legal
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I'm a 100% Combat disabled military Veteran- I have some old

Customer Question

I'm a 100% Combat disabled military Veteran- I have some old judgments against me from around 2010. I don't have the funds to pay off these judgments. what is my best course of action to take care of them?
Submitted: 7 months ago.
Category: Legal
Expert:  legalgems replied 7 months ago.

I am sorry to hear this;

The problem with judgments is that they can be renewed until a party has sufficient assets to pay off the judgment (ie inheritance).

One option is debt consolidation. This is when the consumer takes out one loan to cover all the loans, resulting in a lower monthly payment:

Another option is debt negotiation, where a person will attempt to pay off the judgments as they can afford to, negotiating a lower amount (ie 40-70% of the actual judgment). This presumes that the person is able to save some money each month so they can eventually offer a lump sum settlement

Another option is bankruptcy.

Bankruptcy - 2 being the most common.

individual debtors who have regular income may seek an adjustment of debts under chapter 13 of the Bankruptcy Code. A particular advantage of chapter 13 is that it provides individual debtors with an opportunity to save their homes from foreclosure by allowing them to "catch up" past due payments through a payment plan. Moreover, the court may dismiss a chapter 7 case filed by an individual whose debts are primarily consumer rather than business debts if the court finds that the granting of relief would be an abuse of chapter 7. 11 U.S.C. § 707(b).

If the debtor's "current monthly income" (1) is more than the state median, the Bankruptcy Code requires application of a "means test" to determine whether the chapter 7 filing is presumptively abusive. Abuse is presumed if the debtor's aggregate current monthly income over 5 years, net of certain statutorily allowed expenses, is more than (i) $12,475, or (ii) 25% of the debtor's nonpriority unsecured debt, as long as that amount is at least $7,025. (2) The debtor may rebut a presumption of abuse only by a showing of special circumstances that justify additional expenses or adjustments of current monthly income. Unless the debtor overcomes the presumption of abuse, the case will generally be converted to chapter 13 (with the debtor's consent) or will be dismissed. 11 U.S.C. § 707(b)(1)

A chapter 7 bankruptcy case does not involve the filing of a plan of repayment as in chapter 13. Instead, the bankruptcy trustee gathers and sells the debtor's nonexempt assets and uses the proceeds of such assets to pay holders of claims (creditors) in accordance with the provisions of the Bankruptcy Code. Part of the debtor's property may be subject to liens and mortgages that pledge the property to other creditors. In addition, the Bankruptcy Code will allow the debtor to keep certain "exempt" property; but a trustee will liquidate the debtor's remaining assets. Accordingly, potential debtors should realize that the filing of a petition under chapter 7 may result in the loss of property.

It is best to meet with a bankruptcy attorney (most offer free consultation) to determine if that is the most viable option.

If so, one would need to choose between the various options. CH 7 is known as the fresh start approach. CH 13 is more of a restructuring.

Here is a sampling of exempt property for the state of FL (must be a resident for 24 months):

  • $1,000 Personal property
  • $4,000 Personal property if you don't exempt any land as homestead.
  • $1,000 Motor vehicle
  • 401(k) plan
  • 403(b) plan
  • Alimony (necessary)
  • Annuities
  • Annuities, Military
  • Cash surrender value of life insurance policies
  • Crime victims compensation
  • Deferred compensation program, State Employees
  • Disability benefits
  • Disability income
  • Entireties Property
  • Fraternal benefit society benefits
  • Florida Retirement System
  • Hazardous occupations, damages for injuries
  • Health aids, professionally prescribed
  • Health savings account
  • Homestead (house or mobile home you live in + limited land) or (Mobile home you live in, no land) No dollar limit!!
  • Hurricane savings account (twice the deductible of hurricane or flood insurance policy)
  • Illness benefits
  • IRA
  • Local public assistance benefit
  • Payment on account of illness, disability, death, age, or length of service (necessary)
  • Pension payment, non-specific (necessary)
  • Pension, Firefighters
  • Pension, Highway Patrol
  • Pensions, federal, last 3 months (necessary)
  • Pension, Railroad
  • Pre-paid college fund
  • Profit-sharing payment (necessary)
  • Retirement and benefits, Police officers
  • Retirement benefits, State and County Employees
  • Retirement, Teachers
  • Retirement, Civil Service
  • Separate maintenance (necessary)
  • Social Security benefits
  • Stock bonus retirement (necessary)
  • Support (necessary)
  • Unemployment benefits
  • Unemployment compensation
  • Unemployment compensation
  • Veteran's benefits
  • Wages, Head of family
  • Wages, Seamen and Masters
  • Worker's compensation
  • Wages, Seamen and Masters
  • Worker's compensation

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