Don't Understand Filing 13???

[TLK]

My attorney has recommended that we (me and my wife) file 13 because my income exceeds the median income for Texas. What I don't understand, and my attorney couldn't respond in plain english, is that if we have negative income after monthly expenses, how can we enter into a 13 and make the monthly payments? All our expenses are within the acceptable range and we're current on the mortgage and the only car payment we have.

[needafreshstart]

My advice talk to another attorney. Sad to say not all attorney's will do what's best for you. Attorney's get paid more in chapter 13 than they do in chapter 7's. Without knowing all details there may be a different reason they attorney is suggesting a 13, but definetly talk to several attorney's and see if you get the same response.

[vleisme]

You must have assets that cannot be protected in a ch 7. Our atty, at first, thought we could do ch 7 and we are well over median but we have some equity in our house and in our vehicle so he said they would want us to liquidate if we filed ch 7.
Do you have equity in your home above the exempted amount for TX?

[lrprn]

My attorney has recommended that we (me and my wife) file 13 because my income exceeds the median income for Texas. What I don't understand, and my attorney couldn't respond in plain english, is that if we have negative income after monthly expenses, how can we enter into a 13 and make the monthly payments? All our expenses are within the acceptable range and we're current on the mortgage and the only car payment we have.

Knowing whether you have disposable income or not is not as easy as just subtracting income minus expenses. There's a complex Means Test and Schedules to complete that determine whether you have disposable income and how much.

I wouldn't take the word of just one lawyer. Set up free or low cost initial consultations with at least three more bankruptcy lawyers in your area. Find the one that gives you answers you understand. Also start doing your own research by reading online resources about bankruptcy, read the stickies here, and do searches in the forums.

If you are behind on house or car payments and want to keep them after you file, then Ch 13 may be your only choice. We need more information about your finances, the state you live in, whether you are married and filing jointly, if you have kids, what assets you do want to keep, etc to help you sort out which bankruptcy chapter you might qualify for.