Please help me

[Tatetytiffany]

We live in Kansas and have about $60000 in credit card debt. Payments have been made on time untill now. I also have two 401-k loans totaling $27000 payments are about $620 a month. My wife and I each have 1 car and they are both paid for. Mine is a 1988 s-10 worth maybe $500 she has a 98 grand caravan worth $4500. Are house is worth $164000 we have a first mortgage of $159400 and a 2nd mortgage of $24000. 1st mortgage payment is 1259 and second is 304. We net about 3200 per month not including the 401-k loans which are taken directly from my check.

Expenses
House 1563
utilities 309 phone,internet,trash,water,cell,electric,gas
cable tv 60
house ins/property taxes 240
life ins 55
gas/ins 200
grocerys 700
school lunch 70
babysitting 200
clothes/household goods 75
kids sports/pet care 60
entertainment 40
misc 100
total 3672
We have 3 kids ages 12,10,6 we own nothing else of any value. no big screen tv or jet ski's or boats or anything like that.

Is chapter 7 possible. Chapter 13 does not make any since. Cards were last used about 35 days ago. Cash advances totalling $2500 to keep bills current and got shoes for kids about $100.

We want to keep the house. No place else to go. please advise, thanks

[cathyh]

I'm not sure about Kansas law, but I live in Illinois and have gone through a chapter 7. They will probably take the equity in your house if over a certain amount, in Ill. it's $7500. You can reaffirm your mortgage and keep your house if all payments are current. Your cars however are fair game as they are paid off. They are considered an asset.So they will basically look at what you have as assets (what you actually own) that is worth anything. We both still had loans on our cars, but we had to state what the cars were worth vs. how much we owed on them. Check out a few websites about bankruptcy law, and put in your state, and that should give you an idea about how much equity you are allowed in your home. In a chapter 13, you don't lose any of your property, and the court sets up a repayment plan that best fits your budget. And it's usually only for 3-5 years and creditors usually only get a small percentage of what's owed them. After the 3-5 years, whatever is left is usually discharged. So look at what you have for assets and see if you can afford for them to be taken, or else a chapter 13 may be a better choice. I hope this helps a bit. Best wishes to you in this difficult time.

[HHM]

Yeah, you could probably file a chapter 7 under your circumstances, and it would probably be best. Keep current on your mortgage payment.

To be sure, schedule a free consultation with a local attorney and ask him/her about the exemptions that are allowed in Kansas.

Good luck and get to it.

[Tatetytiffany]

Exemptions

Thanks for your help. I did look up the Kansas bankruptcy exemptions and for personal property under automobiles its says Motor Vechile to $20000, unlimted if disabled. Wasn't sure what that meant in my case. Thanks

[robivi3]

To be honest, Kansas is pretty generous according the exemptions listed in this forum. I imagine that this generosity comes from the dust bowl days and the Great Depression, though the figures have changed. In an agricultural area I imagine it was designed not to wipe small farmers out and destroy the local economy when prices fall.