Personal Bankruptcy Filing Bankruptcy for a dissolved LLC

[ppnj4]

In 2005 we opened a small LLC consisting of myself & my husband. Due to financial loss we had to close it in 2006 and dissolved it in 2007. During that time we were open we borrowed from our suppliers and now owe about $30k to them. Since we personally signed for what we borrowed they have legally come after my husband and I levying everything from our bank accounts to our cars. We've been out of work for a year now and this is very taxing on us, creating more hardships for us than money they recover for themselves. Since we personally had a bankruptcy discharged in 2004 we are not eligiable to file again until 2011, but I am curious if there is a way around that since we borrowed under the LLC. Can we bankruptcy under a dissolved business name? If so does that vacate the personal agreements we signed when we borrowed under the business name?

We are living on a shoestring of dwindling unemployment & child support, teatering on foreclosure on our house, have horrible credit and only a questionable $25k in equity in our home (though no one will touch us for a loan since our credit is bad and we have no real income), we've tried to sell the house several times but no luck and the realator fees would eat any profit to pay off the debt. Legal Aid's response was there was nothing they could do. We can live with out the bank accounts but I need the car to find work, any suggestions on the bankruptcy or how to deal with this would be appreciated. Thanks!

 

[Michael Wechsler]

Since we personally had a bankruptcy discharged in 2004 we are not eligiable to file again until 2011, but I am curious if there is a way around that since we borrowed under the LLC. Can we bankruptcy under a dissolved business name? If so does that vacate the personal agreements we signed when we borrowed under the business name?

No offense, but it shocks me that you were discharged in bankruptcy in 2004 and then you got a nice sized loan in 2005. That said, how could you think that somehow a business bankruptcy will somehow extinguish the personal debt? That is in place to make sure that the loan is paid back in case the business goes bust. Your inability to file again for bankruptcy is in place because it's supposed to make sure that people who can't pay debt can't simply borrow from people time and time again without paying for their debts. I don't want to sound unsympathetic to the pressure you're in now but you really needed to think through this and understand the processes and why they are in place.

we've tried to sell the house several times but no luck and the realator fees would eat any profit to pay off the debt.

I think you should stop worrying about profit and look at the reality of the situation. If your monthly payments can be reduced by selling the home and you're free from the burden of a mortgage, you should think about it.

Legal Aid's response was there was nothing they could do. We can live with out the bank accounts but I need the car to find work, any suggestions on the bankruptcy or how to deal with this would be appreciated.

Legal aid can't do anything. I don't know what to tell you except it sounds like you spoke to everyone you can. Many will tell you to sell some of the assets you have while you can and if they have value to reduce your debt and try to make settlement arrangements with your creditors. Good luck.