Another Judgement

We received a default judgement in the mail yesterday for $435 plus $95 in court costs. At first I didn't remember even receiving the summons, but it came just before Christmas, when things are so hectic both at home and at work that they it was easily forgotten.

I don't know if the next step will be for them to issue a wage garnishment,or what. The notice we received yesterday said thing about it.

What gripes me most about this judgement is that it was for a bill that we don't even owe. At least, in my opinion. Part of it is for a food system my wife joined that she can no longer even access because they closed up shop and moved out of town. The rest is for dental work that I already paid for in full.

At least this judgement can be added to our bankruptcy filing.

Rate Hike

You know, it's no wonder that people with financial problems have such trouble pulling themselves out. I just had a car picked up last night to be returned to the lender. A car that was totaled several months back in a rollover accident that wasn't paid for because we couldn't afford to insure it. After the accident, we found a way to afford insurance.

That was six months ago. Now the policy is up for renewal, and I just got a notice that the rate will be going up $17 a month! And not because of the accident, either (I reported the accident when I applied for the insurance). No, the insurance went up because of our "insurance score," which is just Progressive's fancy way of saying that our credit score stinks, so they're raising our rates.

After making on time payments for six months, they have decided that our difficulty paying our bills has made us a higher accident risk. I think we'll be shopping rather hard for a new insurance company before the policy renews in February.

Sure, their ads say they have the best rates, but what they don't tell you is that they'll stick it to you six months later if they can!

Voluntary Surrender

My crunched up car has just been taken away to be returned to the dealer where I bought it. I must say that everyone involved in the process of recovering it was quite professional. You normally wouldn't expect such professionalism from a lender repossessing a car and the recovery company they hired.

It's good to have that eyesore gone and to have my garage back. It's one less item I have to report on the assets section of my bankruptcy petition. And one less secured loan that I have to worry about. The debt will now be easily discharged.

I took my son outside to watch the men hooking the car up to the truck. He asked, "They fix it, then it works?" I explained to him that it was being taken back where Daddy bought it. Talking with one of the men in the truck, I told him my son would have been more excited if they had brought a large tow truck. He told my son that the type of truck they brought is called a "sneaker." Which, of course, means they can pull up in it in the middle of the night, hook up a car, and sneak off with it. It literally took less than ten minutes for them to hook up and be gone, and I can see how it could have been much faster if they needed to be stealth.

More On The Totaled Car

After some additional consultation with my Attorney, he has advised the following:

If you do not want to keep the car, I will advise you to contact the lender
to make arrangements to surrender it to them. Once your bankruptcy is on
file, then they can make no claim against you. The debt to them will be
considered unsecured at that point and you will be able to discharge that
debt in bankruptcy.

My concern was mostly that if I surrendered the car to them, they would be able to add the charges for the recovery to my debt. The point is, if they take the car back, then I no longer have in my possession the item I purchased from them on loan. Even if they added their costs to my debt, that debt would be discharged, effectively eliminating the costs altogether. In addition, surrendering the car to them would mean no more calls from them, no more totaled car taking up all the space in my garage, and no more concern for how I'm going to get rid of the thing after the bankruptcy is final, which is the soonest I would have the title to be able to sell it as salvage.

I'll be contacting the lender tomorrow to make arrangements for them to come pick up the car.

A Quick Response

I would not have expected to receive a response until tomorrow from my Attorney, but he has already replied via email.

His suggestion is that I NOT take any action with the car dealer, but rather wait until my bankruptcy has actually been filed -- when I'll have more options. Now I have to figure out how to stall the repo man.

Request for Repossession

I spoke today with a representative of the car lot where we purchased the car that was totaled. After speaking with my Attorney, they assumed that the car wouldn't be listed in the bankruptcy proceeding because the car is worth more than the loan balance. They weren't aware that it was totaled without insurance.

I spoke with the representative and explained the situation to her. She was actually quite nice and professional, which is very unusual from a creditor speaking to someone in the process of filing bankruptcy.

She asked me to send her a picture of the damaged car -- probably to satisfy themselves that the car is totaled.

Moments later I received another phone call that displayed BLOCKED CALL on the caller ID. I let the answering machine screen the call and called back at the number given in the message.

The caller had been from a towing company that represented the car dealer. He wanted to make arrangements to have someone pick up the car this evening. Again, it's unusual to have a "repo man" call you to schedule a repossession -- and he, too, was quite polite and professional.

I told him that I didn't have access to where the car was stored so late in the evening, especially on such short notice (the car is actually stored in my own garage). I told him I might be able to make arrangements for tomorrow after speaking with my Attorney.

When I asked him what the dealer's interest is in the car now that it's totaled, he said that it would be sold at a salvage auction and the proceeds would be applied to the balance of my loan.

I emailed my Attorney for advice with the concern that the recovery fees for the repossession would be ADDED to my loan balance, actually INCREASING rather than decreasing my debt.

It's refreshing to deal with people who act so professionally in a situation when most creditors can be so rude and disrespectful. Of course, I'm just a little wary of their actual intentions.

I should have an update with the Attorney's response tomorrow.

Year End Update

Things have been a little quiet on the bankruptcy front. The holidays can kind of do that, I suppose. There are just a couple of updates.

1. The calls from collection agencies have mostly ended. I'm starting to realize that sending letters to creditors might not have been the best method to end some of the phone calls. The two I mentioned writing to have both contacted me since then. The first, which is a car dealership that I still owe payments to for the car I wrecked several months ago, called my attorney, who apparently has forgotten that the car has been totaled. They contacted me again after speaking with him to ask me to contact them because the car is worth more than I owe on it. Of course, they don't know that it has been totaled, either. If they knew, they would also know that the car is worth much less than I owe on it, even though it is only a few months from being paid off.
2. The second creditor I wrote to is a law office that is collecting on an agreed judgment. These guys just can't seem to get the clue. They called me on both Christmas Eve and New Years Eve, both of which were Sundays. I imaging this one will take a little work to take care of.
3. We're making slow progress on paying the costs of filing bankruptcy. As I've said before, if we had the money it takes to file bankruptcy easily, it would be easy to pay our bills and we wouldn't need to file. We're about 18 percent paid so far.

Coming soon: recording our assets for filing purposes.