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Our Dilemma


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Well, what to do now. Have all the paperwork in front of me, ready to file our BK7. But, this is the problem that we don't have a clear cut solution with.....

Had planned on filing a Class Action suit against a particular CA, and lawyer representing decided not to take the case unless we filed a BK13.

Which would assume, debt would still be ours. Stronger case, I am figuring. Also, I have a stockpile of violations against other CA's and would have cases on maybe a few, or at least a stronghold settlement with some of them. So, we are thinking to change course and file a 13.

Not that we would be lining our pockets, just want to make a point.

Another factor is that we may have too much equity in our home, IL exemption 15,000. total for DH and I. And even if we have it appraised again befor filing, I still think it will put us over the exemption by about 6k.

SO, is this too much equity? I haven't put too much research into filing a 13, but I do know that it isn't so easy. We have a substancial amount of unsecured CC debt, business debt included with little inventory leftover and supplies (maybe 3k), and no secured debts other than mortgage and car (upside down on). We do owe some tax, under 2k, that we are making payments, and will be able to pay off with our next tax return.

We don't have a huge amount of other assets, some computer equipment, music equipment, electonics, that were charged on cards IIB. (2-3k)

I DO KNOW, our mortgage company is committing fraud by holding our payments (I have documentation with proof of receipt), wanting us to default. Have posted in Mortgage forum "getting us to default". So, I am wondering what they are up to.........

I just wanted some opinions on how others maybe would handle given the situation. I would like to pay off debt, as our financial situation will improve, DH is getting commission monthly and my other biz is getting off the ground. But it looks poor on paper now, couldn't make much for trustee payments. Is that a factor, whether we don't make enough to file a 13? Or will they factor in our improving situation?

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One thing about the equity in your home. That may be reduced if you figure in the real estate commission as well as the other closing cost. Plus, you value the home at a walk away value. Remember, the trustee will have the same expenses you have in selling.

If you can at all file a Chapter 7, file it. Don't worry about a few pissant collection agencies just to make a point. Get on with your life.

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Thanks for your imput. It is almost too late for settlements and credit repair for us. Because of the planned BK, we let several lawsuits against us go to default judgement, with advice from attny. I got lazy and didn't DV those accounts, and also got arb. award against us because didn't respond against. Our debt is way out of reach, would take quite a long time to pay off without filing BK. Although most is unsecured CC debt, we don't have the cashflow yet to make any settlement arrangements. So, the light isn't shining in our direction. I just thought that if we would happen to file a BK13, maybe it would be possible to file suits against some of the CA's that have brought aggression into my life, and get some $ to pay back some of this debt, through the petition. And, don't want to risk losing the home. Our Lender is also making us see red, and not quite sure what they are up to as far as our mortage. As far as the homestead exemption, I forgot to factor those other things, so I guess we may be ok.

Another concern; DH started contributing to employee 401(k) back in Dec., about 200.00 per month. I asked the bk attny. if there would be a problem, (could be paying Creditors instead), she said would be exempt.

I have doubts that it could be considered fraud or insider preference.

I realize my options here, favorably to file Chapter 7, but we MAY have more expendable income factoring in my recent income (this is a partnership, service business, under 700. business tools, no other assets).

I understand that I shouldn't base filing either BK on "punishing" the CA's,

and at least, I can send concerns to the AG,FTC, BBB, etc. I do want to get on with our life, believe me, been a year in hell. I just want to weigh in all the risks involved, and do best for the overall situation. I am going to contact the BK attny. today to discuss in more detail. I just know on these boards we are all concerned and helpful to every one who posts, that is why we are here. I think all in all, this is the best advice anybody could ask for and appreciate it greatly.

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