“ My senior client cannot do Chapter 7 because he has a lot of non-exempt equity in his house. He can only do Chapter 13 to handle those credit cards.”
WHAT do I mean by “very senior client?” The client is 90 years old. He qualifies as my second most senior client, after a 92-year-old client 10 years ago.
Well, the oldest human in California died last year at 101. That was not my client. My most senior client was 82 when we filed his Chapter 7 case to wipe out $40K,000 of credit cards. After he got his discharge, he started fresh without debt and got a new wife who was 30 years younger. So, that’s what you get with your fresh start at the age of 82. You feel young again. That’s what he told me when he brought over his new wife to introduce to me. I think it is good to have some tales of longevity amidst all the intense media daily minute-to-minute coverage of COVID-19.
Let’s put things in perspective: The sky is not falling. This too will pass. And the world will go back to normal. The vaccine will be developed. It does not matter who develops the vaccine as long as it works. The virus does not distinguish race or geography. The important thing is for all races, the whole of humanity to unite to fight it. Besides, the mortality rate is low. People over 60, and those with weaker immune systems, have a higher mortality rate of 14%. But by and large, the mortality rate is 3.5%. This means, even if you get infected, you will most likely recover from it, even without the vaccine.
My 90-year-old client has a lot more to worry about. First, who needs $34,000 in credit cards at 90? The client needs at least $1,000 a month of minimum payments to keep those current every month. His social security is $1,600 and he has a pension of $400 so he has $2,000 of monthly retirement income. Half of that goes to pay credit cards just to keep them current. Second, right after we filed his bankruptcy case, his kidney starts acting up. His filtration rate dropped from 40% to 15%. You would think that dialysis would solve the problem. But his doctor just discovered a mass growing in his kidney which biopsy reveals is cancerous.
Well, I would say that at 90, he has already lived a full life. Not many people live up to 90. I mean, Kobe was only 41 and had barely declared “mamba out.” And we all know that the pilot hired to get him and his daughter to the ball game should have been more careful and experienced. Life is full of surprises. What did Kobe mean by “mamba out?” Kobe referred to himself as a deadly mamba snake on the court because his shooting accuracy in the basketball court was so deadly. So “mamba out” meant that he was retiring.
Okay, back to my very senior client. He had a business but it was not making money and he literally got scammed out of hundreds of thousands of dollars by one of those Nigerian scams targeting seniors. When you get an unsolicited call or contact who tells you that there is a pot of gold, a huge pot of gold, in your name worth millions of dollars and all you have to do is give him some money in advance and the pot of gold is all yours, do not believe that fairy tale. It is false. It is not true. It is a scam to get money from you. And for you senior ladies, who get those calls that your Mr. Romeo that you have never met across the Atlantic ocean needs money from you for whatever reasons, do not believe he loves you. I know you are tempted to take $50,000 from your credit cards to send to Mr. Romeo. Do not do it. But if you have already sent him the money and cannot pay back the $50,000 in credit cards, it is time to consider wiping out those cards with Chapter 7.
My senior client cannot do Chapter 7 because he has a lot of non-exempt equity in his house. He can only do Chapter 13 to handle those credit cards. The plan payment in Chapter 13 will be much less than $1,000 a month but it still hurts him because what he needs is Chapter 7 where the $34,000 is entirely wiped out without any payment.
In Chapter 7, the trustee would have the power to force the sale of his house and use the proceeds to pay off the $34,000, after paying the client his $175,000 of exempt equity. This would be like using a sledgehammer to kill a mosquito. Of course, nobody wants to lose his house for $34,000 of credit cards, right? I would not file a Chapter 7 for the very senior client under any circumstance because I do not want him to lose his house. In his case, Chapter 13 is the best alternative. It would protect his house from creditor liens from the $34,000 of credit cards, and at the same time it would allow him five years to pay off the $34,000 without interest and during these five years, creditors will be prohibited from calling him, and continuing collection efforts, including lawsuits, garnishments and levies. It gives him peace of mind for the next five years while his house is protected from creditors.
The question is, will he live another five years? That is up to God, really. God may still have a purpose for him to achieve in the next 5 years.
If you have a debt problem and need debt relief, please set an appointment to see me. I will analyze your case personally.
* * *
Lawrence Bautista Yang specializes in Bankruptcy, Business, Real Estate and Civil Litigation, and has successfully represented more than five thousand clients in California. Please call Angie, Barbara or Jess at (626) 284-1142 for an appointment at 20274 Carrey Road, Walnut, CA 91789 or 1000 S. Fremont Ave., Mailstop 58, Building A-10 South Suite 10042, Alhambra, CA 91803.
