Is my business exempt from collections?

[0REDSOX7]

If you're comfortable with it, then go and do it.

We will be here to help where we can!

[DaveInAZ]

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@HopeMission wrote:

I checked no. I haven’t paid 0 on each of the cards over the last 3 months.

Of the required 500/mo. minimum payment, I’ve been paying BofA for years, About 275 of that 500 was for that month’s interest and the rest ended up going against the principle and keeping the balance under the limit.

To answer your question, I wish I had filed years ago. Now after paying thousands of dollars I am just looking for some extra counsel and confidence before officially hitting the “Send” button on my online BPP form. They will check my numbers and send it through from there.

I again recognize that the consensus on this thread is that I should get an official lawyer because of my (Sole Proprietor) service/ home based business.

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Does anybody still feel my situation requires a REAL lawyer?

Is there anything else I might be over looking here?

Can I hit “Send”?

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- Yeah, if you haven't paid them in 3 mos you'd better file before they start filing for personal judgments against you. Good luck.

[StartingOver10]

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@HopeMission wrote:

I respect that the consensus is to get a good attorney for peace of mind.

I have looked at what a variety of local lawyers can offer me beyond the info I can get myself from a NoLo book and a BPP (Bankruptcy Petitioner Preparer)  

To me it just doesn’t seem worth the 2K. They all seem to want to just push me through and use a form that’s similar to the one given to me by my 300 dollar BPP.

I have been receiving some council from a Pre paid Legal outfit (29/ mo) and they have been telling me the business is exempt. “Nothing to worry about.”

From the comments it sounds like this might not be for certain. Does anyone else have any experiences or thoughts about if BofA would try to take something from a persons business?

Again this a (Sole Proprietor) service/ home based business. In other words without me, there is no business. Just about all business is done on my computer. Computer was bought in cash. There really isn’t any inventory.

More than half of the ~200/ mo I spend on the CCard for the business is for Yellow Pages and Internet advertising.

Thank you again for your guidance.

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You don't seem to understand that the form (the petition) is the same form as it is the form that is required to be filed.

The difference is a good BK attorney knows exactly what can be done and not done. They have experience and knowledge that is not present in the NOLO book (not bashing this book at all because it is a very good resource).  When you get to your 341 the trustee will specifically ask if you used one of those bankruptcy preparation type firms (that is not a good thing in their eyes). Because those firms can not give you legal advice at all.

It also sounds like you have been talking to those mill type bk firms - at least that is how I read your post. I could be wrong there, but you can really tell the difference in skill set between a good BK attorney and one from a 'mill type' firm where they do just push you out and you don't get much for your money.

Before you make the final decision, at least interview a good BK attorney from a small firm that actually has one or two attorney's and a paralegal or two. You should see the difference right away. If you feel the same way, then do what you have to do. But the difference between a good attorney and a BK prep firm is huge. It isn't the form. It's the experience and the knowledge that you can't pick up in NOLO or with the prep firm.

Most errors are made in the filing and the prep firm can't advise you if you made an error in the petition because that is legal advice which they are prohibited from providing.

[HopeMission]

It's my new understanding that when filing a personal BK7 this would include expenses from my personal business... so does this mean my business and “tools of the trade” are exempt? 

Just to recap. I own a (Sole Proprietor) service/ home based business. In other words without me, there is no business. Just about all business is done on my computer. Computer was bought in cash. There really isn’t any inventory.

My income is 26K. Assets that arnt exept are about 10K. My BK7 is over just (2) BofA cards. 9K business and 33K personal. Each card is over 10 years old. Both cards have less than 200/mo business expenses. Nothing has been run up. Each card has been hovering beneath the limit for at least 12 months so I have been paying off everything thing that has been put on each card plus interest.

Pardon the pun.. but the jury still seems to be out as to weather a BK7 case such as mine would warrant the investment in a formal attorney to help me through what I believe is a pretty simple case for discharge. Does anybody disagree?

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Dave in AZ, made a great point in that BofA could try and sue since I am now just about to 90 days late on their two cards. With that said, I feel like I have done my due diligence and should get this case on the fast track.

I thank 0REDSOX7 for all his help and the encouragement that he and others will help me as I enter the next phase.

StartingOver10: It would be great if you could give me any specifics that the trustee might request that I may have over looked?

Thank you again EVERYBODY with your help and guidance.

[StartingOver10]

When you are a sole proprietor your assets belong to you and your business.

You have to include all of your assets when filing as well as all of your debt, you can not pick and choose.

The trustee is trained to look for assets especially when you are self employed. To give you an idea, when I filed, I had to provide years of records to the trustee.

Trustees expect the petitioner to 'forget' to list assets and they have staff that does nothing but research you and your assets and debt looking for assets.

I am not trying to scare you, but trying to introduce a little reality into this situation. You have a business. You can't exempt certain assets from your business unless they are within the allowed asset exemptions for your state. The trustee will use a strict construction. 

Remember, the trustee is not your friend. They are paid something like $65 per Ch 7 case + 10% (IIRC) of whatever assets they recover for your creditors in your Bk.

My thought for you is that you are thinking your business will be viewed as a separate entity from you and yet you don't have it set up that way. Since you are a sole proprietor you are responsible for all of your debt and you own all of your assets so they all have to fit within the allowed exemptions or you have to give up the asset.

If you are looking to keep certain assets you may want to consider a Ch 13. 

The good thing about a Ch 13 is you can convert to a 7 if you qualify for it.

[HopeMission]

Thank you “StartingOver10” for all this EXCELENT information. As it is, my CCards are all mixed (Personal w Bus.) which would make this a nightmare if the IRS was auditing me but I guess this doesn’t make any difference when filing for a California BK7.. were one of the same.

I didn’t realize the trustee would be requiring any records besides the petition. Since I am keeping up all my debts and obligations except for my CCards… I will definably take your advice and go through all my paper and online statements very carefully.

I don’t think Ill find many surprises since my business doesn’t need any inventory HOWEVER I have several advertising expenses. Aprox 200/month. I have never been late and continue to keep up with all Yellowpages, website and other advertising vendors. Does anyone know how marketing and advertising looks to trustees?

I hear a lot of people worried about what trustee might do to their business. What could they do? Seems like the generous Calif. exemption’s (including Tools of Trade $7,625) and HUGE wild card ($26,925.00 ) would protect most folks including myself. Would they make me change the name the business is licensed to operate as?

Thank you again for your guidance.