Would like to Convert Chapter 13 to a Chapter 7, attorney says NO!!

[kcfaninin]

Hi,
We are wanting to convert our Chapter 13 to a Chapter 7. Everyday we get more and more medical bills in the mail and income is decreasing by about $800/month. Sent recent pay stubs, expenses, medical bills etc., to attorney. She worked the figures and said we are still over the median income by about $34,000. This is figuring our decrease in income and expenses. I took the sample means test from the link on this sight with the same figures she has and the test states that we qualify for a Chapter 7. Shows we have negative disposable income of $-1,723 per month. Am I missing something here? Any thoughts??? I used the means test on johnfire.com. Is there another one I should try?

[LuciluS]

http://www.legalconsumer.com/bankruptcy/nolo/

The above is from the Nolo Book.

I would call her or, better yet, just drop by and ask for a copy of how she calculated your figures.

Luci

[moneytrouble]

Yes. Ask her how she calculated her figures, or print out your report from the website!!! Mine also was way off.

[HHM]

What are your large expenses such that you are over median by $34,000 and would have negative DMI. Frankly, that is a large amount of overage to be eaten up in "allowed" expenses.

[justbroke]

Funny thing, I actually "pass" the means test (just ran recently and based on my petition date numbers) and I have a negative DMI of $945+. I am over 2 times the median income. (Yeah, it's my mortgage(s).)

[maddog2112]

Kcfanin, I pm`d you. Maddog

[DeadManCrawling]

If you are already in a 13 and are that much over the median, with only an $800 loss, I think you will have a very difficult time with this.

If your medical bills are high enough to make up the difference, you will be in a better position of course, but you will also likely have to explain why these elevated medical expenses would be expected to continue through the remaining ch 13.

Since your expenses and income were already determined once, for the 13, and signed off by yourself, your attorney, the trustee, and probably the UST, I think you may be fighting an uphill battle here.

However, if there really is enough change in income and medical expenses to do this, you owe it to yourself and your family to do all you can to make this happen.

[kcfaninin]

Our mortgage is $2325, new medical bills are now at $6500. Our daughter has a long cardiac history and is probably going to have surgery again this summer. Parent Plus loan is $22,100. We got another vehicle $355/mo during the plan which was approved by the trustee, but attorney isn't calculating that into her figures. Why?!?! Don't know. We revised our living expenses because attorney had us fudge our numbers when we filed in order for the "plan to work". These figures were not accurate form the start. We now have to pay our daughters car payment of $210 because the doctor advises her not to work until she gets another cardiac work up. She passes out when she stands for long periods and is not allowed to drive either. Can't sell the car, won't get what we owe. Our income has decreased by about $800/month for the last 2 months. I have taken 2 different sample means tests online and they both say we qualify for a Chapter 7 with a negative disposable income of -$1600 to -$1700 per month. Either I'm doing something wrong or our attorney isn't that bright. I am using the same figures that she has. We have a consultation with a new attorney on Tuesday. Just wanting a second opinion.

[HHM]

Is your daughter over/under 18?

[kcfaninin]

She is 20 and a full time college student. I know we can't claim the bills on a Chapter 7 because they are in her name, but yet we are responsible for them because she is still our dependent. There is no way she will be able to pay for them, not until she is out of school and then, it's not her responsibility. She is a dependent on our insurance.

[LuciluS]

She is 20 and a full time college student. I know we can't claim the bills on a Chapter 7 because they are in her name, but yet we are responsible for them because she is still our dependent. There is no way she will be able to pay for them, not until she is out of school and then, it's not her responsibility. She is a dependent on our insurance.

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Start working with her doctor(s) and let them know you need to know specifics on her upcoming surgery and who you would need to talk to about the costs. Also, get specifics on time frame of how long she will be 'disabled'. If it's over 12 months, then I believe her medical expenses should be allowed. See if you can get the doctor(s) to put such statement in his notes. There is also something I read about funding a Disabled Relative in Bankruptcy.

When I applied for Social Security Disability, I was turned down twice & case was given to an Administrative Law Judge. He brought out two specific items in determining my eligibility. One was that my Neurosurgeon stated in his notes on 'this date' Luci is 100% disabled (you don't have to be 100% to get SSD) & that I saw their Social Security Doctor who also stated my spine was in horrific disarray.

Although, she is of legal age, her cardiac maladies might qualify her for some kind of disability. It's getting late, but I will do a tad bit more research on SSDI as I SSD which is based on some many years previous income. SSDI is a tad bit different.

I know when my son was in college, we could carry him on our medical insurance until he reached the age of 22. We have a Parent Plus Loan also of $115.20 a month. It is my DH's son's first year of college at Indiana University and he nearly flunked. DH told him, he wasn't paying college tuition for him to party. I believe it started out at $16,000 in year 2001 or 2002 and at end of last year was about $11,500.

Luci

[HHM]

She is 20 and a full time college student. I know we can't claim the bills on a Chapter 7 because they are in her name, but yet we are responsible for them because she is still our dependent. There is no way she will be able to pay for them, not until she is out of school and then, it's not her responsibility. She is a dependent on our insurance.

Yep, that is the problem. You will get tremendous push back from the trustee and court if the expenses that are making you have no DMI are related to support of an adult child. That is probably why your attorney is saying no. No harm in trying, I suppose, but be prepared to lose.