Been wading in denial for way too long now..

[I_Suck]

After much thought and many ulcers, I have come to the conclusion we need to file for BK. It's just so frustrating how we got this bad in debt. It's really pathetic that we have pretty good combined income and yet we can barely scrape by. Hind sight is definately 20/20.

I am going to start the hunt for a good bankruptcy lawyer in the Raleigh/Cary area.

Questions I will be asking:
- What are the fees to file for BK.
- Can I file chapter 7 or chapter 13.
- Will we be able to keep our home.
- Will will happen with both cars.

Our stats:
live in North Carolina
wife and I both work
we have 3 kids
combined income $101K

Our assets:
Home: mortgages-$325K last appraised at $325K
Car 1: loan-$15K kbb-$16K
Car 2: loan-$0 kbb-$4K

Our debt:
my student loan debt: $42K (all federal)
wife student loan debt: $120K ($90K federal and $30K private signature)
credit card debt: $42K
car 1: $360
car 2: paid off

Monthy Bills:
1st mortgage: $1690
HELOC: $625
credit cards: $1100
utilities: $290
auto insurance: $95
my student loan: $450 (in deferment)
wife student loan: $950 (in deferment)
prepaid college plans for all 3 children: $230
grocery bill: $800

[anonymuse]

To get started, you may want to read the Tactical BK Manual in the sticky post. The first thing you need to do is take the means test. Due to your income, Chapter 7 is most likely out of the question; however, it will help you determine how much disposable income you'd have available to put into a plan.

I'm sure you know that student loans are not dischargeable.

[Anj]

question - 13 or 7?

[I_Suck]

I'm sure you know that student loans are not dischargeable.

Oh yes, I am painfully aware.

[anonymuse]

Oh yes, I am painfully aware.

I have them too, but they are something I feel in my heart that I'm obligated to pay since I don't want to deny anyone else the opportunity to attend college. Until a job loss, I never felt bad about paying them since I felt like it was such a small part of the income I was bringing in and I would have never have been making that income without them. Since I haven't been able to find a comparable job since my job loss, yes, it is indeed frustrating; however, I'm going to take my lawyers advice and just put the job search on hold for a bit since I'm not in a good mind set right now during interviews and there is an air of desparation with everything.

[I_Suck]

Sadly, despair is a very relevant adjective here.

[lrprn]

We've all been where you are right now. It doesn't take much these days with all the highly available credit along with the push to buy, buy, buy. Before you know it, you're overextended to the point of no return. We take home about the same amount as you do - we also have two mortgages ($90K first and $70K HELOC), $22K of loans my husband took out against his retirement, $21K of PLUS educational loans he took out for our son, and $80K in maxed out credit cards and non-secured loans he used over a 5 year period to try to get us out of the hole - it is not a pretty picture. I didn't know how bad our finances were for a long time - my husband did an excellent job of hiding things until it was far too late. We tried credit counseling first - total waste of time. Ch 13 was unavoidable for us, but once we realized that, we did what we had to do and are giving ourselves a fresh start the only way that makes sense. You can too.

[I_Suck]

I hope all goes well Irprn. I would be interested to hear how things turn out with the chapter 13.

[SinkingFast]

Here's a link to your exemptions. Looks like keeping your home and your cars won't be a problem. Since your home is pretty well maxed out loan to value, you can apply part of your homestead exemption as a WildCard toward the one car paid in full. However you or your attny decides, looks like you should be able to keep just about everything.

http://www.bankruptcyinformation.com/NC_exemp.htm

Here's a link to the Gov website that will give you all the info you need for the Means Test:

http://www.usdoj.gov/ust/

The Median Income figure for a family of 5 in NC is $63285. But don't let that cause you to faint at this point. That just means you'll have Presumption of Abuse at the start of the Means Test.

Depending on the county you live in, you'll get an amount to deduct for rent/mortgage and utilities:

http://www.usdoj.gov/ust/eo/bapcpa/b..._charts_NC.htm

Say you're in Durham county, your attny will automatically enter $1152/mo as the allowable on your Means Test. BUT,........ Your house payments are more than that. And mortgage is a Secured debt. So the attny will get to deduct the additional difference, annualized out over 5 years, later on in the Means Test.

Plus, you'll get to annualize out, over 60 months, the excess on your one car payment. That will be a few bucks there.

Not sure if you'll get to add the Student Loan Payments in on the "Other Priority Debt" section or not. If you can, then there's bucks there too.

And I don't know how in the world they figure the Ch 13 Trustee's fee/mo. It will be whatever % for your area. But what they multiply that % times I don't know. I know when I ran the Means Test I didn't figure in that amount. I came out with $115/mo disposable income. I told an attny that during a Consult and he said the Trustee's fee would eat that disposable income amount. So how that get's figured is questionable.

While on the surface, you look like a sure fire candidate for a Ch 13, once an attny crunches the numbers, that may not necessarily be the case. And even if you do wind up in a Ch 13, it may not be a huge montly payment amount like you may be worried it will be. Keep in mind, there are other allowable deductions that are based on what you actually do pay. Childcare costs, health care costs, Telecommunications which includes internet and cell phone, charitable contributions, extra education costs, things like that. A home security system may qualify under the "Family Violence Protection" section. Your attny will have to sort it all out.

[I_Suck]

Thanks for the input SinkingFast. I live in Wake county so my allowable living expenses is $1320, a little better but not by much.

With the chapter 13, it's my understanding that you still pay your creditors over time or a reduced settlement.

What happens if you don't have any extra money per month to actually pay off your creditors? Let's say after mortgage, car payment, utilities, food, necessities, there isn't any money left over?

[anonymuse]

Not sure if you'll get to add the Student Loan Payments in on the "Other Priority Debt" section or not. If you can, then there's bucks there too.

It's a bummer, but student loan payments, even though you can't discharge them, are still categorized as unsecured non-priority debt.

[anonymuse]

QG, I didn't think even you would stoop this low.

[Bobby'sGirl]

Emotionally stunted, perhaps QG perceives us on the board as new parental figures to be challenged to give validation to his feelings of persecution. I am now ignoring him; won't "vote" on banning. So silly.

[Credit Hater]

Emotionally stunted, perhaps QG perceives us on the board as new parental figures to be challenged to give validation to his feelings of persecution. I am now ignoring him; won't "vote" on banning. So silly.

Problem solved

Thank you HRx

[meme]

i tried the 13 for 9 months. I've been bringing home less than $50 a week. i converted to a seven on friday. from my understanding 3 out of 5 13s are not completed. some get dismissed and some get converted. i decided that it was just easier for me to walk away. i couldnt live off 50 a week. all of my utilities were in shut off. im in worse shape now than i was before i filed. the 13 didnt work for me but i tried