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Are retirement income benefits attachable due to BK?

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Bill Ford

Guest
What is the name of your state? CA

Greetings

In 2000 I divorced from a 40 year marriage. Kids are grown and gone. I am a retired CA state Civil Service worker and now receive retirement benefits from the state and from Social Security. I'm 66 years old.

I had to carry some 30 thousand dollars in unsecured credit card debt from the divorce. I have no appreciable assets. No R/E, no stocks, no savings and I don't have the winning lotto ticket. The "assets" I do have are typical household appliances, cookware, video stuff, no furniture of any kind (true), personal affects and a 1983 Ford work van (valued at 800 via Kelly Blue Book). No life insurance, minimal Medicare health through SS and I'm "residing" in a $480 a month warehouse unit in a small industrial complex.

Not trying to paint a bleak picture, just establishing a plausable reason for filing BK (7) and first raise the following question:

Are either or both (Civil Service Retirement income and/or Social Security income) retirement incomes attachable by creditors? What effect would that income have on successfully discharging the 30k credit card debt in an application for Chap 7 BK?

Its tough enough to make it with a very small retirement income let alone have to pay out half of my income to keep up with the credit card debt I got from the divorce.

Thanks

Bill Ford
SoCalif
 


bigun

Senior Member
Retirement income is exempt from creditor seizure. You must list all income, expenses and, debts in a bk filing.
Most lawyers give free initial consultations. Talk with a couple.
 
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Bill Ford

Guest
Hi Bigun.....

Thanks for the reply. That tends to clear up that issue. Now, to the second part of the question......

In your candid opinion, how much weight is placed on one's retirement income (or income in general), when the BK docs get to court?

Just for the details, my net after taxes and mandatory Medicare deductions is 2800 a month, not withstanding the usual recurring living expenses. I put forth that if one had an 8 thousand a month income and little expenses, the court may be disposed to deny a Chap 7 on the basis the debtor "could" make payments, and revert the issue to a Chap 11. On the other hand, one with the same expenses but with only 2800 income, the debtor (at age 66+) could very likely be preparing an obituary before the debt is even partially paid off!!

I realize quite well that an "answer" to the question is purely subjective.... I'm just looking for an off the shoulder opinion.

Thanks..

Bill Ford
 

Ladynred

Senior Member
Its not really a matter of what your total income is, its what you have LEFT to pay bills that's the measuring stick. If, after you pay all your normal living expenses (and that includes quite a bit), you have little to no disposable income to pay your creditors, then you're probably going to get your CH 7. If you have enough left over to pay back some percentage of your debt over a 3-5 year Ch 13 plan, then that's what you'll get stuck with (CH 11 is for business only).

For unsecured debt such as yours, with no R/E or other valuable assets, CH 7 is your best bet. Just make sure you list ALL your expenses. A good lawyer can give you a list of those and help you get your disposable $$ down as far as is feasible.
 
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Bill Ford

Guest
Ladynred.........

Great reply.... Thank you.

I'm sorry.... I meant Ch 13.....

I do understand your missive well and I believe I can come up with the expenses necessary to establish the lack of funding.... especially if the Ch 13 is for a 3-5 year period.....

Well now, I have a MUCH better field to work with and much greater knowledge -- thanks to this web site and you folks monitoring it and answering questions.

I have functioned as a paralegal but have not ever delt with BKs. I will "look into" rolling my own, and after evaluating that issue, I'll likely take the docs to an attorney for review before filing.

Thanks again

Happy Holidays

Bill Ford
SoCalif
 

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