Multiple Chapter 13 questions

[drewindebt]

Ok...very long story, summary is:

Wife has been layed off for 5 months. I have had a 30% pay cut...combined income dropped from $130K/yr to 60K/yr which puts us under Virginia's Median income. We are 4 months behind on mortgage so chapter 13 seems to be the only way to go to keep our house. Had to have heat pump and roof replaced around the time she lost her job so there went all of our savings. We have several judgments against us, several coming up. Student loans have now defaulted, property taxes on the house unpaid. One judgment creditor (Capital One) has a freeze on a bank account.

Haven't filed yet because:

We borrowed money from our parents (both sets) some cash and some credit card debt. How will the 13 impact paying them back?

Local debt: 2 children, each with braces being paid monthly thru our local orthdontist. We have to pay this debt off completely to continue their treatment (not finished until June 2010).

We continually stay one month past due on all utilities.

I am paid once per month, she gets a weekly unemployment check of $225. Sometimes, we have to go in the hole with the bank just to make ends meet before I get paid again.

All credit cards maxed out and/or delinquent.

Our biggest concern is not being able to pay her parents back for their credit card debt as they are on fixed income.

We are 4 months behind on the mortgage. I am making one payment each month to keep us out of foreclosure but remain 4 months behind because I can't pay any additional toward the mortgage. We could theoretically take my pay check on September 30 to pay an attorney for our BK filing, but we will probably show no disposable income for Chapter 13. I would prefer to wait until the end of October though so going back 6 months only pulls her unemployment income.

I am sick of worrying about this stuff and just want it to be over.

Any advice/opinions/help appreciated.

[Flamingo]

It sounds like you just cannot afford to even consider keeping your home. First, educate yourself a bit on Chapter 13 and Chapter 7 - this forum is loaded with "Stickys" under each of those Subjectsin this Forum. Secondly, so you know exactly what you can do in the state in which you reside, get a consultation with a BK attoroney in your area (most consultations are free). Take with you a complete listing of all your debts and monthly payments, sources of income, paystubs, asset listing, and your most recent federal and state tax returns. You will be advised what you can and cannot do as to filing and exactly where you stand and you will know where to start. Best of luck to you.

[MSbklawyer]

Which state are you in? What is the approx. value of your house? How much do you owe on your house? How much is your monthly house payment?

Are there any realistic prospects for improvement in your financial condition (i.e. wife getting called back, your pay going back up, &c) in the near future?

What are the judgments for?

Do you have any credit card debt or other unsecured debt?

Do you have car payment(s)?

You need to sit down with a bk lawyer and go over all these questions and quite a few others to determine what you want to do and what you are able to do.

My sense is that you want to keep you house above all else. Right?

I or any bk attorney would need answers to the above questions and quite a few more before good advice could be given. Bk attorneys usually don't charge a fee for an initial consult. You need to set down with one and get a feel for what your options are.

check here: www.nacba.org

In the upper right hand of the home page there is a link that will help you find an attorney near you whose bankruptcy practise focuses on debtor bankruptcy law.

[woeisme]

If you file CH 7, you can always pay back parents after discharge. Same goes for Ch 13 actually, it's just that it will take 3 years to complete plan if you are under the median income. Your parents could be listed as creditors so some of CH 13 payments go to them, but sounds like you can't afford to fund a CH 13 to pay back house as is, so very little to none will go to unsecured debts after the secured debts are paid. I'm sure you don't want to hear this, but you might have to just let house go and file CH 7 to get out of this mess. Just like parents, could pay orthodontist voluntarily after discharge of CH 7 so kids teeth continue to be taken care of. But you need to go over your budget with a fine tooth comb to see what your options are, can't really tell from such limited info. Best to bring all this info to a lawyer and see what the options are from him/her. best of luck!