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BK filed Dec 17. It’s a mixed blessing?

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Anonymous
Not applicable

BK filed Dec 17. It’s a mixed blessing?

I spent a good 14 years being severely under employed and/or unemployed after a company I worked for back in 2003 basically swept an act of harassment against me under the rug, and so I resigned. Never thought I would NOT find a comparable position but I never did. So, I walked away from some debt -- I couldn't even afford to declare bankruptcy. 

Along the way, I picked up several judgements against me. But they never really came after me; most likely because of my chronically low wages and bouts of unemployment. Then in 2016, my mom passed and left me her home mortgage free. In 2019, I finally got a decent job. Then two of those creditors put a lien on my home. But because judgements and liens are no longer reported to credit bureau, I just thought they were inconsequential-- especially since no one was seriously threatening me. Plus I incorrectly thought I was covered by the statute of limitations in my state. The judgements were filed in time so unbeknownst to me I was still vulnerable. 

 

Also by then, my credit report was clear so I slowly and strategically began rebuilding my credit. Then this past summer, one of those creditors seriously began coming after me. At times, all of them had sent letters, which I ignored, and they'd just leave me alone. But this just felt different. 

I was right. In early Dec. I got a letter from Messerli & Kramer that they had a Summary Judgement to garnish my wages. As much as I didn't want to, it had to be done. I quickly found a great BK attorney, got his office everything he needed, took my class, and by the end of the week on Dec. 17 my Ch. 13 was filed. Just in time because my very next paycheck was missing $500, which was given right back.

Whew! I dodged a big time bullet. I would not have been able to keep up with any of my financial obligations with that one creditor getting $500 of every paycheck. 

The repayment plan is extremely reasonable and I'm actually able to save money now. But it still makes me sad because I had worked so hard on getting my credit score up. My last report from Experian before my score fell like a ton of bricks was 740. 

While I'm relieved, it is still rather surreal to me. I'm 61 years old. I'm close to retirement. I'm not in the best of health. I feel like I have nothing but bad luck with my career. I barely have anything to retire on. And now I'm starting all over, again. 

The good thing is, my BK should be discharged in Dec of 2026. I'll retire (maybe) in 2027. Hopefully, I'll hang on to my current level of health, and go into retirement and live to a good age like my mom. Hopefully debt free. 

 

Message 1 of 8
7 REPLIES 7
Caribsa89
Contributor

Re: BK filed Dec 17. It’s a mixed blessing?

Good luck.  It will go fast after you get through the 1st year. I filed a BK7 10 years ago and finally was completely free on o2/01 of  this year.

Message 2 of 8
CH-7-Mission-Accomplished
Valued Contributor

Re: BK filed Dec 17. It’s a mixed blessing?


@Anonymous wrote:

I spent a good 14 years being severely under employed and/or unemployed after a company I worked for back in 2003 basically swept an act of harassment against me under the rug, and so I resigned. Never thought I would NOT find a comparable position but I never did. So, I walked away from some debt -- I couldn't even afford to declare bankruptcy. 

Along the way, I picked up several judgements against me. But they never really came after me; most likely because of my chronically low wages and bouts of unemployment. Then in 2016, my mom passed and left me her home mortgage free. In 2019, I finally got a decent job. Then two of those creditors put a lien on my home. But because judgements and liens are no longer reported to credit bureau, I just thought they were inconsequential-- especially since no one was seriously threatening me. Plus I incorrectly thought I was covered by the statute of limitations in my state. The judgements were filed in time so unbeknownst to me I was still vulnerable. 

 

Also by then, my credit report was clear so I slowly and strategically began rebuilding my credit. Then this past summer, one of those creditors seriously began coming after me. At times, all of them had sent letters, which I ignored, and they'd just leave me alone. But this just felt different. 

I was right. In early Dec. I got a letter from Messerli & Kramer that they had a Summary Judgement to garnish my wages. As much as I didn't want to, it had to be done. I quickly found a great BK attorney, got his office everything he needed, took my class, and by the end of the week on Dec. 17 my Ch. 13 was filed. Just in time because my very next paycheck was missing $500, which was given right back.

Whew! I dodged a big time bullet. I would not have been able to keep up with any of my financial obligations with that one creditor getting $500 of every paycheck. 

The repayment plan is extremely reasonable and I'm actually able to save money now. But it still makes me sad because I had worked so hard on getting my credit score up. My last report from Experian before my score fell like a ton of bricks was 740. 

While I'm relieved, it is still rather surreal to me. I'm 61 years old. I'm close to retirement. I'm not in the best of health. I feel like I have nothing but bad luck with my career. I barely have anything to retire on. And now I'm starting all over, again. 

The good thing is, my BK should be discharged in Dec of 2026. I'll retire (maybe) in 2027. Hopefully, I'll hang on to my current level of health, and go into retirement and live to a good age like my mom. Hopefully debt free. 

 


How much is the judgment for?   What is the net equity in your home if you were to sell it today, ater paying RE agent costs, any transfer taxes your state charges, title insurance, escrow fee, etc.?   Also is there a second judgment against you?   Even if they are not pursuing you now, their judgment attaches as a lien and would have to be paid off before you could sell the house.

What I'm thinking is if you could come up with a chunk of cash, you could settle that judgment for maybe 40 cents on the dollar.   Nobody wants to get their money, especially when you are protected by a BK and they may not be entitled to any interest.

Message 3 of 8
jmw1
Frequent Contributor

Re: BK filed Dec 17. It’s a mixed blessing?

Don't ignore the liens. They are still there.

 

What did you do with the liens on the house?  Since you are in BK, now is the time to pay your lawyer to file a motion to avoid lien and get rid of them. It's expensive to get rid of the lien, but your house will be hard to sell at a good price someday with those liens there because the title is clouded. Pay to get rid of them. Best part is that your repayment amount doesn't have to necessarily increase to pay your lawyer.

Message 4 of 8
BillSmiff
Established Member

Re: BK filed Dec 17. It’s a mixed blessing?

The advice @jmw1  gave is VERY important. As a Realtor, I have seen more than I care to in regards to unknown and known liens etc over the 21 or so years. Have your Attorney deal with this now, they know the rules and will guide you the best way(s) to minimize your costs and stress. It sucks but will be the "suckiest suck that ever sucked" per Homer Simpson if you wait until the home is potentially listed years down the road after fees etc accumulate. 

 

I wish you the best with all this and it will work out the way it is supposed to for you when you get the help you need to deal with this. The other side(s) have Attorney's and you deserve to have one as well. 

Message 5 of 8
Anonymous
Not applicable

Re: BK filed Dec 17. It’s a mixed blessing?

My attorney took care of the liens with the bk. 


@CH-7-Mission-Accomplished wrote:

@Anonymous wrote:

I spent a good 14 years being severely under employed and/or unemployed after a company I worked for back in 2003 basically swept an act of harassment against me under the rug, and so I resigned. Never thought I would NOT find a comparable position but I never did. So, I walked away from some debt -- I couldn't even afford to declare bankruptcy. 

Along the way, I picked up several judgements against me. But they never really came after me; most likely because of my chronically low wages and bouts of unemployment. Then in 2016, my mom passed and left me her home mortgage free. In 2019, I finally got a decent job. Then two of those creditors put a lien on my home. But because judgements and liens are no longer reported to credit bureau, I just thought they were inconsequential-- especially since no one was seriously threatening me. Plus I incorrectly thought I was covered by the statute of limitations in my state. The judgements were filed in time so unbeknownst to me I was still vulnerable. 

 

Also by then, my credit report was clear so I slowly and strategically began rebuilding my credit. Then this past summer, one of those creditors seriously began coming after me. At times, all of them had sent letters, which I ignored, and they'd just leave me alone. But this just felt different. 

I was right. In early Dec. I got a letter from Messerli & Kramer that they had a Summary Judgement to garnish my wages. As much as I didn't want to, it had to be done. I quickly found a great BK attorney, got his office everything he needed, took my class, and by the end of the week on Dec. 17 my Ch. 13 was filed. Just in time because my very next paycheck was missing $500, which was given right back.

Whew! I dodged a big time bullet. I would not have been able to keep up with any of my financial obligations with that one creditor getting $500 of every paycheck. 

The repayment plan is extremely reasonable and I'm actually able to save money now. But it still makes me sad because I had worked so hard on getting my credit score up. My last report from Experian before my score fell like a ton of bricks was 740. 

While I'm relieved, it is still rather surreal to me. I'm 61 years old. I'm close to retirement. I'm not in the best of health. I feel like I have nothing but bad luck with my career. I barely have anything to retire on. And now I'm starting all over, again. 

The good thing is, my BK should be discharged in Dec of 2026. I'll retire (maybe) in 2027. Hopefully, I'll hang on to my current level of health, and go into retirement and live to a good age like my mom. Hopefully debt free. 

 


How much is the judgment for?   What is the net equity in your home if you were to sell it today, ater paying RE agent costs, any transfer taxes your state charges, title insurance, escrow fee, etc.?   Also is there a second judgment against you?   Even if they are not pursuing you now, their judgment attaches as a lien and would have to be paid off before you could sell the house.

What I'm thinking is if you could come up with a chunk of cash, you could settle that judgment for maybe 40 cents on the dollar.   Nobody wants to get their money, especially when you are protected by a BK and they may not be entitled to any interest.


 

Message 6 of 8
Anonymous
Not applicable

Re: BK filed Dec 17. It’s a mixed blessing?


@jmw1 wrote:

Don't ignore the liens. They are still there.

 

What did you do with the liens on the house?  Since you are in BK, now is the time to pay your lawyer to file a motion to avoid lien and get rid of them. It's expensive to get rid of the lien, but your house will be hard to sell at a good price someday with those liens there because the title is clouded. Pay to get rid of them. Best part is that your repayment amount doesn't have to necessarily increase to pay your lawyer.


Email from my lawyer today:

The judgment liens will be gone once your case is completed.  We have obtained approval to remove the liens, and once you receive the discharge the liens will be gone for good.

Message 7 of 8
righthererightnow
Frequent Contributor

Re: BK filed Dec 17. It’s a mixed blessing?

Congrats on the house, and moving forward. Sending you healthy, rebuilding energy. Heart




Message 8 of 8
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