Cc Charged Off Now What

[phas]

What is the name of your state?KY

checked credit report, they have been charged off.
My husband had 1 to sue, had a old lawyer friend to tell us that there was no consideration,they got judgement but judge told us to appeal, so it is in appeals court now. The debt was only $7,000 how far will they take it.
But have one that is taking me to court in Oct.
? is can they put a lein on the house while it is in appeal?
our friend said they cannot touch the house because it is in the marriage.
the cards are in just one name.

 

[Ladynred]

All further actions are usual stayed during the appeal process.

Not sure what you mean the 'house is in the marriage'. Unless your 'friend' is a lawyer, then how do you KNOW what the friend said is valid ?? Unless KY protects your home thru tenancy by entirety, and your house is deeded that way, it is not going to be protected against a lien.

 

[phas]

yes, he went to law school.
He said not to go bankrupt that they can't take nothing anyway.
But how will the new laws change? will it be harder or can we still get out about the same when they change the law? Don't owe on the house so would like to stay in it as long as possible.

thanks LNR

 

[Ladynred]

The changes in the new BK law is significant. It will make it nearly impossible for some people to file CH 7 at all and if you can, then some of the protections offered now will be reduced or removed under the new law. Credit counseling will be mandatory and YOU will have to pay for it before you can even file at all. Once past that, you will have to go thru the 'means test'. If your income is higher than the 'median income' for your state, CH 7 will be denied and you will be shoved into a very restrictive Ch 13 for FIVE years. Your ACTUAL expenses won't mean diddly, people will ONLY be allowed the expense amounts set out by the IRS collection standards .. and those can be pretty lean. If you own a house you should be ok, but if you RENT, you could have trouble if your rent exceeds what the IRS says you can spend.

Bottom line, it will NOT be easy and it WILL be very, very hard and much more costly to file bankruptcy after 10/17.

The KY code says the following about judgments:

426.720 Final judgment to act as lien on realty -- Judgment creditor's notice requirements.
A final judgment for the recovery of money or costs in the courts of record in this Commonwealth, whether state or federal, shall act as a lien upon all real estate in which the judgment debtor has any ownership interest, in any county in which the following first shall be done:

(1) The judgment creditor or his counsel shall file with the county clerk of any county a notice of judgment lien containing the court of record entering the judgment, the civil action number of the suit in which the judgment was entered, and the amount of the judgment, including principal, interest rate, court costs, and any attorney fees;


427.060 Homestead and burial plot exemptions -- Exceptions.
In addition to any exemption of personal property, an individual debtor's aggregate interest, not to exceed five thousand dollars ($5,000) in value, in real or personal property that such debtor or a dependent of such debtor uses as a permanent residence in this state, or in a burial plot for such debtor or a dependent of such debtor is exempt from sale under execution, attachment or judgment, except to foreclose a mortgage given by the owner of a homestead or for purchase money due thereon. This exemption shall not apply if the debt or liability existed prior to the purchase of the property or the erection of the
improvements thereon.

So, given that, I see nothing to exempt or protect the property just because you may own it jointly, and the KY code says nothing about 'tenancy by entirety'. You get to exempt $5,000 in your equity in the home against judgments but that does NOT stop them from placing a LIEN on your property.

You say you don't OWE on the house. If that means that you own it free and clear, 100% equity, then your house is vulnerable indeed. With 100% equity and only 5K exemption for equity, you're looking at a Ch 13 to keep your house if you filed bankruptcy.

 

[phas]

LNR found this article below.
says ky allows for real estate only so will that protect the house. Got 40 acers paid for.
Also our income is only $1,277 a month, so should we just hold on as long as possilbe or go ahead with bankruptcy.
Would just like to stay in house as long as possible either way.
Also would we still be able to do chapter 7 after Oct.
Thanks for your input just trying to cover all of our bases.
But if the credit cards can't take our house i don't see no reason to give it to bankruptcy court. Just like any advice from someone that has been through something like this.
thanks

TENANCY BY ENTIRETY

States that allow couples to own property through "tenancy by the entirety," a type of joint ownership that offers protection form creditors. States that allow tenancy by entirety:

Alaska
Arkansas
Delaware
District of Columbia
Florida
Hawaii
Maryland
Massachusetts
Mississippi
Missouri
New Jersey
Mississippi
Oklahoma
Pennsylvania
Rhode Island
Tennessee
Vermont
Virginia
Tennessee
Wyoming

States that allow tenancy by entirety for real estate only:

Illinois
Indiana
Kentucky
Michigan
New York
North Carolina
Oregon


Source: Nolo Press






The most common types of property ownership:

Joint tenancy: Available in nearly every state, this form of ownership is used for everything from homes to bank accounts. Its biggest advantage is that jointly owned property doesn't go through probate, the sometimes costly procedure by which the court distributes your assets after you die, says Mary Randolph, author of 8 Ways to Avoid Probate, by Nolo Press. You can enter into a joint tenancy with anyone.

But joint tenancy has some serious drawbacks. If your spouse or other co-owner slides into debt, creditors could file liens against that owner's share of the home.

Tenancy by the entirety: This type of title is similar to joint ownership, but offers better protection if one spouse is in debt or files for bankruptcy, Randolph says.

While laws vary among states, creditors usually can't come after the indebted spouse's portion of the property, as is the case with joint ownership. If your spouse has a lot of debts or is planning to launch a business, tenancy by the entirety "can be a powerful protection," Randolph says. Creditors "can't force the split of the property to get at one spouse's half."

Tenancy by the entirety may not protect you if your spouse is in trouble with the IRS. The Supreme Court ruled last year that the IRS can place tax liens against a home for one spouse's unpaid taxes, even if the property is held in tenancy by the entirety.

Most states that offer tenancy by the entirety (see box, above) limit it to married couples. Like joint ownership, property automatically reverts to the survivor when one spouse dies, bypassing probate.

Community property: If you're married and live in a community property state, most property is automatically considered jointly owned. There are exceptions for inheritances and gifts. But in most cases, your house will be considered community property.

Unfortunately, debt is also considered community property, and it's more difficult to protect your home from your spouse's creditors, says Emily Doskow, an attorney and legal editor for Nolo.com.

Community property states have different rules governing probate, so it's important to understand your own state's rules when planning your estate.

For example, five states — Alaska, Arizona, California, Nevada and Wisconsin — allow couples to avoid probate by titling their property as "community property with right of survivorship." This option "gives you the best feature of joint tenancy and community property," Randolph says.

Titles and estate planning

While reviewing your title is a good idea for all couples, it's particularly important for couples with large or complicated estates that could be subject to estate taxes.

For example, one of the most popular tools for avoiding estate taxes is a bypass trust, which enables a married couple to double the amount of the federal estate tax exemption, now $1 million. With a bypass trust, the first spouse who dies can leave up to $1 million in a trust to children or other heirs, instead of the surviving spouse. When the second spouse dies, she can leave up to $1 million — or more if the exemption has increased by the time she dies — to her heirs.

But without proper planning, the trust may not serve its intended purpose, says Cal Brown, a financial planner for The Monitor Group in Fairfax, Va. If the home is held through tenancy by the entirety, for example, the home will automatically transfer to the surviving spouse instead of to the trust, he says.

One way around the problem is to title the property as "tenants in common," which helps preserve the trust but doesn't protect the property from one spouse's creditors. Another alternative is for the couple to own the home through tenancy by the entirety, but arrange for the surviving spouse to disclaim the inheritance. That will allow the deceased spouse's ownership to go into the trust.

In either case, it's important to consult with a competent financial planner or estate attorney ahead of time, Brown says.

Sandra Block covers personal finance for USA TODAY. Her Your Money column appears Tuesdays. Click here for an index of Your Money columns. E-mail her at: [email protected].

 

[Ladynred]

IF your DEED is recorded as 'tenancy by entirety' then your house IS probably safe, but you need to be sure of what the DEED says.

The homestead exemption will ONLY protect the house, not the 40 acres of paid-for land. It may also be vulnerable to judgment creditors.

Also our income is only $1,277 a month, so should we just hold on as long as possilbe or go ahead with bankruptcy.

Is that your GROSS ?? Its not your total income that matters, its what you have LEFT OVER that is the biggest factor.

Once the new law takes effect on 10/17, everyone will be subjected to the 'means test'. If your income is more than the median income in your state for your family size, then Ch 7 will be nearly impossible. If you're BELOW the median income, then its still not going to be easy to go Ch 7.