One born every minute
Posted: Wed Mar 23, 2005 10:15 am
I would see if you could have this lady refinance to pay off her debt,
as it looks like either a chapter 7 or 13 would result in her losing her
house. Since she can't pay in a 13, no use going there; and why file a
chapter 7 and incur all the extra costs (trustee fees, trustee's
professionals, commission to broker, etc.). Either way the result is
100% payout because of equity, so she might as well do it herself
without the extra costs of a bankruptcy, hence netting more that $50K
for her. In fact, if she can't refi (or somehow work a deal with her
creditors) and would lose her house in a chapter 7 (or 13) anyway, she
might as well sell the house herself and avoid all the problems and
extra costs.
Non-dischargeability issues irrelevant from economic standpoint if 100%
payout; i.e., debts paid in full anyway. However, why go thru all that,
who needs such a judgment in their name; and why even take a chance that
a chapter 7 trustee would end up paying less than 100% (due to admin
costs or underselling of property), leaving debtor possibly saddled with
some remaining debt . hence, back to trying to work this out without a
BK.
Don't know if she would have a valid cause of action against the psychic
for fraud or something, to try to get back her money, but doesn't look
good under the circumstances you outlined.
Joseph E. Caceres, Esq.
Caceres & Shamash, LLP
8383 Wilshire Boulevard, Suite 1010
Beverly Hills, CA 90211-2409
Tel: (323) 852-1600 x 102
Fax: (323) 852-9009
E-Mail: jec@locs.com
Sent: Tuesday, March 22, 2005 5:22 PM
To: cdcbaa@yahoogroups.com
Subject: [cdcbaa] One born every minute
First, for starters... is it just me, or have the quality of cases
entering into consultation since the Senate's passing S.256 been of a
different quality?
I've been tempted to write in about a number of "interesting" fact
patterns, but this one got me to put pen to paper (as it were):
A lady get suckered in by a psychic. I mean, really taken in. They
prey on her gullibility and vulnerability and next thing you know, have
her taking out cash advances. $5000 here, $2000 there. Always in cash.
She gave all of it to these people to get rid of the bad spirits that
have been causing her problems in love.
I believe that this lady truly believed at the time that she would get
the money back. She believed that the "case" they're working on for her
would result in her having happiness. Intent to repay seems to be
there. Whether Citi and Chase will buy it is a whole 'nuther story.
Damages? About $30,000 in cash advances as recently as last month, and
they even got her to tap into her 401K and take out a loan for $10,000.
She otherwise has no debt.
Oh, and this divorcee has a house with over $160,000 of equity. It
would certainly seem that even a Chapter 13 would result in her losing
the house -- it doesn't appear that, with her income and budget, she
could make work a 100% plan to cover all the debt.
So, trying to see down the road: adversarial actions, she loses the
house, gets $50,000 and maybe possibly can convince a judge that she did
not intend to defraud anyone. In fact, she was defrauded, but so far is
unable to convince the police to write up a police report (their answer:
"you made a bad business decision").
She's the honest but, um, imprudent debtor. Do you see a different
result?
And are the higher income borderline cases coming out the woodwork to
get in before S.256 is law and prevents them?
Very truly yours,
Hale Andrew Antico
Attorney at law
(800) 227-2947
http://LosAngelesBankruptcy.net
"I am easily satisfied by the very best."
-- Winston Churchill
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