We knock out Dyck-O’Neal, Save Lonnie’s Clearance and his Family Home Place
Lonnie was about to lose his federal job. His clearance review showed he owed Dyck-O’Neal $127,153 from a foreclosure deficiency. He needed to take care of that. Or he’ll lose his clearance and his job.
Obviously he didn’t have $127,153. And when we looked at it, he couldn’t file Chapter 7 bankruptcy either. When his parents died, Lonnie had inherited a share of their home place. The parents’ home place was paid for. A Chapter 7 bankruptcy trustee would take and sell it.
Chapter 13 Bankruptcy Payment Plan–How Can He Afford it?
He needed to do a Chapter 13 bankruptcy. To protect his clearance by paying his debts. And protect the family home place–by paying his debts. But, in a Chapter 13 payment plan, how much would Lonnie has to pay?
The Chapter 13 trustee demanded a payment Lonnie couldn’t afford. The trustee didn’t want the whole $127,153. But he wanted most of that to be paid.
What’s the Statute of Limitations
The statute of limitations is a law that says if a creditor leaves you alone too long, they are too late. More than five years after the mortgage company accelerated the loan (starting the foreclosure process) was too late. (That’s five years under Virginia law. Each state sets their own rules on this.)
Based on the records we had, it looked like the five years was up. Dyke-O’Neal had more complete records than us–at least they should have. But they didn’t fight. So, we won.
Now all Lonnie has to pay are the smaller debts he was paying anyway.
Don’t put it off
Foreclosure or repossession? Talk to a bankruptcy lawyer right away. You probably have eligibility now–you need to find out of course. And in three or four years when they come after you, you might not. (Lonnie could have filed Chapter 7 when the house foreclosed; after his parents died, then he couldn’t.) Usually relying on good luck doesn’t work real well.