More Questions??

[Liaah]

Can you continue to contribute to your 401k during a chap 7 or chap 13?

If you have student loans, can you continue to pay them in BK and add them to your monthly expenses?

If you have $160 left after all of your deductions and are forced into a chap 13, is $160 your monthly payment now for the next 5 years?

If you quit paying your cc's and now your debt is rising from what you originally owed to what you owe now with all the late fees and over the limit fees, and then inherited money within the time frame that the bk court could take it, what would you owe? The original amount or the new debt amount with all the late fees and over limit fees?

Thanks!

[SinkingFast]

Can you continue to contribute to your 401k during a chap 7 or chap 13?

The Court has been allowing for modest contributions to 401K as an acceptable Expense/Deduction from your earnings. Modest is defined by the Court you file in. Generally speaking, you can go up to about 5%, give or take a bit depending on where you file.

If you have student loans, can you continue to pay them in BK and add them to your monthly expenses?

It's really gonna depend on your Trustee and your District. Student Loan debt has special consideration. It's treated like a Priority Unsecured Debt even tho it technically isn't a Priority Debt.

Some Districts allow for the payments as a monthly Expense while others don't. Some Trustees actually make PI payments. Other Trustees pay Interest only. While other Trustees pay nothing. So it's really gonna depend on where you're filing as to how Student Loans are treated.

Student Loans possibly receive different treatment by different Trustees because many times, Filers can place the Loans into Forebearance for the duration of the BK.

If you have $160 left after all of your deductions and are forced into a chap 13, is $160 your monthly payment now for the next 5 years?

If you're below the Median, you could possibly get a 3 year plan. Over the Median, it will be a 5 year plan. While you might submit a proposed Plan for $160/mo payments, the Trustee is gonna go over your Schedule J with a fine toothed comb looking for more money.

Folks here have reported that their Trustee took Pet Expense monies. Money that paid for premium services of Cable or Satellite TV. The Filer claimed too much for Entertainment so the Trustee took part of that money. The Trustee can trim many different places on Schedule J if they want.

If you quit paying your cc's and now your debt is rising from what you originally owed to what you owe now with all the late fees and over the limit fees, and then inherited money within the time frame that the bk court could take it, what would you owe? The original amount or the new debt amount with all the late fees and over limit fees?

To the CC's and rising debt,............. Yes the fees, lates, penalties, and interest get tacked on to what you owe. That's effective up to the day you file. When we quit paying our CC's, we owed approx $120K. By the time we filed, our debt had risen to $150K. That's the $$$ amount we filed to have discharged. $150K.

About an inheritance,............. The day you file sets the BK Estate. If you file Ch 7, the BK Estate exists for 180 days after filing. If you file Ch 13, the BK Estate exists for the duration of your Payment plan. If you inherit money within either time frame, the Trustee can seize your inheritance "for the benefit of your Creditors".

If you're in a Ch 13 Payment Plan, paying less than 100%, the inheritance monies will be added to your total payback. Up to 100%. You could continue to pay for the original number of months planned, or your plan could be paid out early. Depends on how much you owe, what your payback % is, and how much money you inherit.

Thanks!

HTH

[Liaah]

Thanks, that does help a lot. Unforutnately my dad is in very poor health...
I stand to inherit a large amount. Enough to cover all of the debt.

What would happen if I am the beneficiary on a life insurance policy? I just would hope that the BK court would let me bury my dad with that money before seizing it? Would they?

[SinkingFast]

If I remember correctly, you're supposed to declare if you're the beneficiary to anyone's Estate or any Life Insurance policies. I'm almost certain that's a question the Trustee asked us at our 341. I am very sure that our attny asked us about that.

Here's a couple threads for you. We have a member, BKBiker, who was a Ch 13 filer and went thru receiving an inheritance while in Ch 13 BK. BKBiker detailed a bit of what he went through.

This is the First, chronologically:

http://www.bankruptcyforum.com/showthread.php?t=7630

And here's the Second:

http://www.bankruptcyforum.com/showthread.php?t=8498

Hopefully, BKBiker's experience will help you know what to expect.

But honestly, what happens in your particular situation is really gonna depend on the size of the inheritance, your Trustee, how far along in your plan you are, and other things.

Even tho we do have one National BK Law, there is no one way it's enforced. What's allowed here where I live may be more lenient than where you're going to file. Or our Court here may actually be more strict about some things than yours is.

While it is important for you to research, learn, and be an informed BK Filer, your best bet to learn what might or might not happen in your case is to talk to some BK attnys in your area.

I'd suggest you Consult with 3-4 BK attnys, at least. We Consulted about a dozen looking for THE attny we wanted to work with. You'll get different perspectives and you'll get to compare personalities. Find the attny your most comfortable working with. Learn what to expect from the Court where you're filing.

[Liaah]

Thanks, I appreciate all the info.

I will bring all this up to lawyer and see what he has to say.