Scared

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Cheekers

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Scared
« on: August 01, 2015, 01:07:57 PM »
Haven't signed my CP yet as I was waiting to do it in Sept.  However, last night at 915pm I get a knock at the door and it is a woman from a law firm.  It seems my loan from Citi Financal that I am behind on by one payment went to see a lawyer.  In the later it states I have 5 days to pay the entire loan amount or they may start to garnish my wages.  Just a little nerve-racking!

I work in Finance in a very reputible company here in Canada and the LAST thing I need is for my boss to get a granishment letter about me.

I am so scared right now.

Have already opened a new bank account at a bank I have never dealt with and already started to move money into the new account.  Also have applied and waiting on a secured MasterCard from Capital One.  So those steps are done/in process.

I think I might do the CP sooner, like this week coming up.  I just renewed my mtge for a 5 yr term last week so that is locked and safe.  My only concern is my property taxes.  Currently I am behind for 2013 and 2014 but will be paying off 2013 end of Aug and 2014 end of Sept.  I dont want the prop taxes to be part of the CP.  Will they be?  When does the City find out I am in a CP?  The day I sign?  At the end of the 45 day period?
« Last Edit: August 01, 2015, 01:09:54 PM by Cheekers »

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NotATrust-E

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Re: Scared
« Reply #1 on: August 01, 2015, 05:00:16 PM »
With respect to garnishment: Unless you've signed something permitting Citi Financial to garnish your wages (which happens at some credit unions, from what I understand), they will have to get a court order to garnish your wages - which means a hearing, etcetera. It takes a certain amount of time to get a court date, plus the time it takes to actually serve you the motion.  Garnishment is a common threat. I'm not trying to suggest that it doesn't happen, but it's not a cheap or quick process.

Also, it's possible that this person doesn't actually work for a law firm. For example, sometimes the law office of "J. Brian McNulty" will try to collect. It's pretty much a collection company as opposed to a law firm - Google them to check it out. It's very important that you let the trustee know of this collection action so that they can give notice of filing the proposal to the law firm as well as CitiFinancial. You will likely want to give them the document that you received last night.

As to the property taxes: So far as I know, this is a secured debt. The property taxes are secured against your house because if you tried to sell, the city would get their money before you would. Given that, I don't think you CAN include them in your proposal, since you've still got your house. All creditors would be made aware of your proposal at the time of filing, or as soon as the notice goes out.





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Cheekers

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Re: Scared
« Reply #2 on: August 01, 2015, 05:15:31 PM »
I checked and it is a law firm.  It states I have to contact the Citi Finance office where I got the loan and come to an agreement that is amicable for them and me. 
I was really wanting to use the month of Aug to save as much as I can as an emergency fund and file the CP at the end of Aug.  Guess I should file this coming week.
The day I file a CP does that protect me against any further moves by Citi and their lawyer muscle?

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NotATrust-E

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Re: Scared
« Reply #3 on: August 01, 2015, 05:22:45 PM »
They can always vote against the proposal... Beyond that, unless you've signed something to the contrary, I think you're covered.

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Cheekers

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Re: Scared
« Reply #4 on: August 01, 2015, 05:35:34 PM »
Do banks ever not vote on a CP?  For example CIBC is 80% of my debt while Citi is only 10%.  Will CIBC vote or ignore...

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NotATrust-E

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Re: Scared
« Reply #5 on: August 01, 2015, 05:56:52 PM »
There are enough times that a bank won't vote. I don't know anything specifically about CIBC. However, a bank may be more likely to vote in this type of situation where they have a majority.

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Bank-snoopy

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Re: Scared
« Reply #6 on: August 04, 2015, 08:57:35 AM »
Cheekers

Listen to me as I have had my wages garnished

this is the process:
- you get a letter threat (which you got)
- then they apply to the court
- then a letter for you to goto court to state your case
- then the court case takes place
- there is a judgement
- if you lose the judgement (which i did) and they decide to garnish you then they will

This complete timeline for me was over a span of 6-7mths
and from the judgement to the actual garnishment was 1.5 months

my point of writing all of this is; don't let this stress you
if you wanted to do your CP in Sept then stick to your plan
at the most over the month of August you would get a letter from the court (but even that could be more then  a month)

i think you'll be fine if you stick with doing a CP in sept.

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Cheekers

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Re: Scared
« Reply #7 on: August 04, 2015, 10:25:15 AM »
I contacted Citi this am and it was a scare tactic.  Nice to have to worry about it all weekend!
Anyways, I have submitted all my forms and data to my Trustee to prepare my documents for me to sign.  Now I just have to select a date to sign.

Just a little nervous lol

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Cheekers

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Re: Scared
« Reply #8 on: August 04, 2015, 12:29:37 PM »
So I got the #'s back from my Trustee:
-with debt of 51k she feels an offer of $34,500 at 60 mos = 575/month.

That is 67% of total debt.  I am nervous this will not be accepted.  She said if the creditors are not happy then there is a negotiation and she does the negotiating.

She said the day I come to sign I have to bring in first months pay of 575. - is that normal??

This is really freaking me out!   :(

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Anoushka

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Re: Scared
« Reply #9 on: August 04, 2015, 12:47:56 PM »
67% of total debt repayment is very high.  Usually CPs aim to repay 30-some percent of debt.  Is that level of monthly payment do-able for you?  I only ask because CPs are meant to significantly reduce your monthly debt payments, and if you are repaying two-thirds of the debt it doesn't seem like it would be that much of a saving for you. 

Re: negotiation, your trustee cannot commit you to another monthly payment amount without your permission.  If the proposal is rejected she will come back to you and you can review your monthly budget and proposal another amount.  She will act as go between for you and the banks, and she may advise you on another amount, but she cannot agree to another amount without your knowledge.

Bringing the first month's payment on the day you sign is standard practice - it is essentially a payment for the work the trustee is now doing on your behalf.  If the $575 is rejected and a counteroffer is later accepted, you will have to make up the difference for that first payment. 

Hope that helps.

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Cheekers

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Re: Scared
« Reply #10 on: August 04, 2015, 12:54:09 PM »
67% of total debt repayment is very high.  Usually CPs aim to repay 30-some percent of debt.  Is that level of monthly payment do-able for you?  I only ask because CPs are meant to significantly reduce your monthly debt payments, and if you are repaying two-thirds of the debt it doesn't seem like it would be that much of a saving for you. 

Re: negotiation, your trustee cannot commit you to another monthly payment amount without your permission.  If the proposal is rejected she will come back to you and you can review your monthly budget and proposal another amount.  She will act as go between for you and the banks, and she may advise you on another amount, but she cannot agree to another amount without your knowledge.

Bringing the first month's payment on the day you sign is standard practice - it is essentially a payment for the work the trustee is now doing on your behalf.  If the $575 is rejected and a counteroffer is later accepted, you will have to make up the difference for that first payment. 

Hope that helps.

Right now I pay $1000/month on a consoldation loan of 33k to CIBC, then another 370/month for a Citi loan.  The 575 is a relief.

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TreeFrog

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Re: Scared
« Reply #11 on: August 04, 2015, 09:28:08 PM »
Hi!

At 67%, your proposal is very, very likely to be accepted. Sounds as if you are very close to finding some relief. The worst is over ... soon you'll just have the one monthly payment, and no more "scare tactics" going on. Hang in!

Best wishes,
~Wendy

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Cheekers

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Re: Scared
« Reply #12 on: August 10, 2015, 08:29:06 AM »
Signing my CP later this aft and so scared   :-[
What if it is not accepted...??!!

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Bank-snoopy

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Re: Scared
« Reply #13 on: August 10, 2015, 08:52:12 AM »
you won't know for 45days

just go in, sign and then wait and see what happens

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Cheekers

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Re: Scared
« Reply #14 on: August 10, 2015, 09:32:45 AM »
I know about the 45 days but has anyone ever had their CP rejected?  My Trustee said if they don't like it they may counter with a different offer but she looks after all that back-and-forth on my part.

I am just scared they will reject every offer - what happens then...?

 

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