looking to file Chapter 7

What is the name of your state? Texas

I'm a 23 year old male...looking to correct some mistakes of the past....I have debt to the sum of maybe 25k or more...not sure yet waiting for confirmation in the mail...and I'm looking to file Chapter seven....my question is...

I rent and pay a monthly note on a car....both my parents are dead...and so it's just me in this world...and I don't see me "just paying off debt soon at all." If I own nothing...can I even file for chapter seven?

I hope this question is understandable...would seriously like advice...on starting over.

I guess it depends what the debt is for.

Im about to file BK myself and own nothing and Im pretty sure that isnt a requirement. I believe it is easier when you dont own anything, cuz then you dont have to worry about property allowments and such. The only thing I think you would have to worry about is if its the type of debt you can file a chapter 7 on. Secured vs. Unsecured.

Hope that helps....although Im not a professional

[Ladynred]

As Pixie noted, having assets is not a requirement for filing BK. The less you have, the easier it is, actually. If you have 25K in debt and you own only 5K in asssets.. you ARE bankrupt, its just not been made 'offical' by the courts. You can probably keep the car, reaffirming the loan is typical but not always necessary. As long as you keep paying on it, you get to keep it. If you include the car and don't reaffirm, it gets discharged. If you find down the road that you can't keep up the payments, you walk away from the thing with NO liability whatsoever.

Pixie stated a comment about Secured vs. Unsecured debt....I don't know the difference between the too...could you please help....and my car is tote the note...so I don't feel to worried about that....but what pixie stated...leaves me to believe that I may or may not be able to file....because of "secured vs. unsecured" can I file under any situtation or is it case by case**************bk seems to be last resort...I would hate it if in the end......I couldn't file...very confused...please help

[Ladynred]

Secured vs. unsecured makes no difference in filing for bankruptcy. You can file no matter what.

Secured would be a mortgage, where the loan is 'secured' by the property itself, meaning they can take the house and sell it to get their money back. Same goes for a car loan, the loan is 'secured' by the saleable property - the vehicle. If you have a loan on your car, then it is a secured debt.

Unsecured means there is nothing guaranteeing the loan except your promise to pay it back, which is the case for 99% of the credit cards out there. Some, like Circuit City, retain a 'security interest' in the items you buy, and they can ask for them back , but most of the time they don't get anything back at all.

In Ch 7, if you want to keep the property attached to a secured loan, you reaffirm the loan, keep paying, and keep the property. However, if this is only a car, then you don't even have to reaffirm, you can keep paying on it and keep the car and the debt is discharged. If you find later that you can't afford to keep it, you turn it in and walk away and they can't come after you for a cent of it.

Hope that helps ! Sounds like you're ripe for Ch 7, and you shouldn't have any problems.

My point was that if most of your debt is secured a chapter 7 may not help your situation.

Originally posted by Ladynred
You can probably keep the car, reaffirming the loan is typical but not always necessary. As long as you keep paying on it, you get to keep it. If you include the car and don't reaffirm, it gets discharged. If you find down the road that you can't keep up the payments, you walk away from the thing with NO liability whatsoever.

Sorry to butt in here but I have a question regarding this info if I can ask.....can you expand on what you mean by this? I have a car loan but am not sure whether I want to keep it or not being that I owe way more than its worth (I know I can renegotiate that part) and that it is having some mechanical problems. But if I let it go with my BK then I have no vehicle whatsoever Are you referring to including it and not renegotiating and then just try to keep up on the payments and hope they dont come repo it if you are current, and if you get to a point where you cant anymore you already discharged your responsibility for the loan and it can go back without repercution?

By the way Im not sure if this is state specific, Im from WA state

Oh and the comment I made regarding the unsecured vs. secured debt I only meant in which is actually dischargeable in a Chapt 7 or not. I was told that certain kinds of debt are not dischargeable but can be put into a chapt 13 plan. Not that it meant you couldnt file at all based on what kind it was

I don't think you can count on negotiating the difference between what is owed and what the car is worth. It is relatively easy to buy a car once the bankruptcy is discharged. I would make payments but not reaffirm so you don't trigger a repossession, then just let it go and buy after discharge. That's what I did.

Thanks for the help you guys....it's seems as if I'm" ripe for Chapter 7"....this is a great site....there are so many educated individuals on this site....and it seems like a community of bk's and I was so worried that I was alone....

Ladynred your very smart...I see that you've helped so many people on this site...keep up the great work...

Thanks to all...I can now sleep and see a brighter future....I don't know if this is what this site was setup for....but it's what I got from it....thanks

ronjack