Attorney advised Chapter 13???

[whirlwind123]

Hi my attorney advised a chapter 13 because of my income., he didn't even ask about expenses etc., he advised go to CCC get a Bankruptcy certificate and then come back with 2008 tax form., and 6 months Earning Statements., and Charge card list.......

My other question is., I need some work on the car and have to pay the attorney $848.00 up front for fees etc., Can I take a loan on my life insurance policy to cover attorneys fees and get tires on my car., or should I just cash it in?

[lrprn]

Hi my attorney advised a chapter 13 because of my income., he didn't even ask about expenses etc., ....

Unless you make a considerable income, if your lawyer hasn't run the Means Test and Schedules there's no way for him/her to tell for sure that you have to file Ch 13. I wouldn't pay this one any more money until you see your Means Test and Schedules results that show you with enough disposable income to prove you need to be in Ch 13. Your lawyer may very well be right about having to file Ch 13, but what if he/she is wrong?

If you haven't paid this lawyer any money yet, then I strongly urge you to interview at least 2-3 more attorneys before retaining one. You should file Ch 13 only if there's a compelling reason to do so (keep your home, catch up on mortgage or car payment arrears, pay deliquent taxes, etc.)

....he advised go to CCC get a Bankruptcy certificate...

Why did your lawyer want you to go to Consumer Credit Counseling? That's an unusual request.

I need some work on the car and have to pay the attorney $848.00 up front for fees etc., Can I take a loan on my life insurance policy to cover attorneys fees and get tires on my car., or should I just cash it in?

Hmmmmm....it depends if a loan against a life insurance policy is secured or unsecured. I did a quick online search and couldn't unearth the answer.

If you decide to take out a loan against your policy so close to filing, you may have to reaffirm the loan to ensure the lender won't object when you file. If you cash it in, then the amount you cash in will have to be added to your income if you file in the next six months - a bad idea if it's possible after the Means Test and Schedules you find out you may be able to file Ch 7. This is good question to ask your lawyer.

[whirlwind123]

The attorney said CCC to get a bankruptcy certificate., need before filing., my income is $46,000.00..........he hasn't done a means test or schedule yet., I guess that will be when I come back to his office with the other info he requested.

[StartingOver08]

LRPN has given you great advice. For the attorney to look at your gross income and not review your expenses and automatically decide that you need a Ch 13 is not in your best interest unless you specifically requested a 13 to save some assets. Almost sounds like a BK mill. Go for other consults with other BK attorneys. Remember, the attorney has a higher fee when you file a Ch 13 rather than a Ch 7 because they are involved in the process for 3 to 5 years rather than 4 months.

[jwmc1]

Go to another attorney

[optimistic1]

For all you know, the OP could be $20,000 over the state median, leaving very little possibility of qualifying for a 7.

[laurannm]

For all you know, the OP could be $20,000 over the state median, leaving very little possibility of qualifying for a 7.

There have been several members on here who have been over the median by more than $20k and successfully filed for Ch 7. That's why the OP should definitely consult several more attorneys. The first attorney we spoke with wanted to throw us in a Ch13 without reviewing expenses, running a means test, etc. and here we are today on our 1 year Ch 7 discharge anniversary

To the OP, try to find an attorney that will run the means test as part of the consult. Ours did and we had a great idea of where we were headed coming out of the consult

[StartingOver08]

For all you know, the OP could be $20,000 over the state median, leaving very little possibility of qualifying for a 7.

I was well over $20k over the median. You can qualify for a Ch 7 if your DMI is under $100/mth - my budget happened to have a negative DMI. It is about the entire picture (income and allowable expenses) - nothing else. Don't let an attorney convince you that the only thing that counts is income - that is only half of the equation.

[JimKutkowski]

The attorney said CCC to get a bankruptcy certificate., need before filing., my income is $46,000.00..........he hasn't done a means test or schedule yet., I guess that will be when I come back to his office with the other info he requested.

There are two CCC's, one of them does pre-bankruptcy counseling. Most attorneys use Money Management International (MMI), they are the best in the business.

There are a lot of factors that go into the means test (B22C) and it takes some time to do it. It sounds to me like this attorney does more than just bankruptcy. You want a bankruptcy specialist, someone who only practices in that arena and punts the case if they can't handle it.

[dakota112]

Blow this atty or whatever he really is off. Find one who will if you are able to , get you into a CH&7. My atty told me plain and simple, you don't do a 13 unless you absolutely have to and/ or you have assets you want to keep. No assets, let the income drop off to under the median, take a sabbatical and take your bailout. Hell, if the highrollers on wall street can do it with Obamas blessing, than surely you are "entitled" also. It is the way this country is going. Don't suffer in a 13 unless there is no otherway. I never could understand how a 13 offers a "fresh start" to anyone over a 5 year period of stress and indentured servitude. It is cruel and unusual punishment and should be banned.

[JimKutkowski]

Blow this atty or whatever he really is off. Find one who will if you are able to , get you into a CH&7. My atty told me plain and simple, you don't do a 13 unless you absolutely have to and/ or you have assets you want to keep. No assets, let the income drop off to under the median, take a sabbatical and take your bailout. Hell, if the highrollers on wall street can do it with Obamas blessing, than surely you are "entitled" also. It is the way this country is going. Don't suffer in a 13 unless there is no otherway. I never could understand how a 13 offers a "fresh start" to anyone over a 5 year period of stress and indentured servitude. It is cruel and unusual punishment and should be banned.

Some 13's come out with just the secured debt arrears being paid. I have taken over 50 clients through Chapter 13 this year and that is sometimes the only way to avoid foreclosure.

[liz417]

I agree with the other posters....set up a few more free consults with local BK attorneys! Over a year ago, I went to see a bk attorney and he told me that I only qualify for a ch 13 with a $400-500/month payment, I believed him and retained him. Soon after, I found this site and informed myself and learned that I *might* qualify for a ch 7, I set up a few more consults but unfortunately, they too said I only qualify for a ch 13!!! I kept looking because these attorneys took one look at my income (over the median) and automatically said ch 13 without even hearing about my (justified over the IRS limits) expenses!! I kept looking and finally found an attorney and was discharged last month

Good Luck!

[optimistic1]

Yeah, but what attorney is going to take your case if you are 20k over the median, because the Trustee will be all over those types of cases. Better have all your receipts and be ready to justify. And I hope you have lots of time on your hands to interview 20+ attorneys.

[StartingOver08]

OP, where do you live? According to your post you make $46,000/yr gross for your income. Is that the total HH income? How many members are in your household (HH)?

[liz417]

Yeah, but what attorney is going to take your case if you are 20k over the median, because the Trustee will be all over those types of cases. Better have all your receipts and be ready to justify. And I hope you have lots of time on your hands to interview 20+ attorneys.

I was $21k over the median and the Trustee NEVER said anything (I was prepared just in case the Trustee or the UST questioned my numbers)...it's all about your expenses and as 'optomistic' pointed out, be ready will ALL your receipts!