New to Bankruptcy - this may be a naive question regarding personal deductions.

[deedee642]

I have a question regarding allowable deductions. I recently hired an attorney and honestly completed all of the paperwork / budget that he had asked for. Then when I saw the Ch. 13 bankruptcy that he put together at 100% payback I had quite a rude awakening. I live in WI. and am single. My mortgage/home owners fees/ taxes are about $1400 a month. However, the allowable deduction for a single person is only like $750.00. So help me understand how this all works. For example he had me paying back 100% and like $1800 a month to the trustee, I kept saying that doesn't leave me enough to pay my mortgage, groceries, etc. Is it just like, "well that is what is allowed and too bad". This is what I mean about me being naive. I didn't understand how it worked. Is there no where on the paperwork where you can say well my housing expenses exceed the given allowance? I can't be the only one who has experienced something like this.
Thanks
Dee

[Pandora]

Hi DeeDee,

If you post your numbers (income, expenses, back owed amounts etc) we can probably help you determine why you are in a 100% plan. If you are trying to keep items that are secured, have alot of equity you cannot exempt or have back taxes you owe, those are required to be paid at 100%. Its really hard to say why your attorney had you at $1800 a month/100% because we dont know what your numbers are.

I hope you get this figured out soon, know its frustrating but hang in there.

[momofthree]

Your mortgage is allowable even if it is above the standard IRS living expense. If you were renting, it'd be a different story. I believe I said this before, but I'll say it again: Find yourself a new attorney.

[sheilaE]

deedee642-do you HAVE to file now? We retained our atty last March, then found this forum and LEARNED sooooo much. If you have time, don't rush into signing ANYTHING. Our atty never even told us about that Nat'l standards and all the allowable expenses and had us at a high payback as well. There's no way you should be left without the funds to pay your mortgage or be able to buy food. If you post your financial numbers on here, then there are people who are very educated in 13's, that help you figure it all out.

[deedee642]

I owe $120,000 on my condo; however, I am upside down by about $30,000 because of the market.
My attorney did not include the condo in the bankruptcy.

Plan was to pay $89,323 (car & credit cards/installment loans/personal loans) + (trustee/legal fees) over 5 year period 100% payback.
$1,488.73 a month
He listed my current montly income as $5,936 before taxes.
I clear about $2100 a pay period
However I have to pay about $1500 for mortgage/taxes/homeowners fees
I also am paying back a 403b loan.
I have to save money from each check because I do not get any pay for six weeks in the summer.
Student Loan = $240.00 a month
Cable, utilities, groceries, etc.
I have money taken out of my check for a 403B and also a health flexible savings plan

[jetsfan2010]

I owe $120,000 on my condo; however, I am upside down by about $30,000 because of the market.
My attorney did not include the condo in the bankruptcy.

Plan was to pay $89,323 (car & credit cards/installment loans/personal loans) + (trustee/legal fees) over 5 year period 100% payback.
$1,488.73 a month
He listed my current montly income as $5,936 before taxes.
I clear about $2100 a pay period
However I have to pay about $1500 for mortgage/taxes/homeowners fees
I also am paying back a 403b loan.
I have to save money from each check because I do not get any pay for six weeks in the summer.
Student Loan = $240.00 a month
Cable, utilities, groceries, etc.
I have money taken out of my check for a 403B and also a health flexible savings plan

your disposable income is what caused your 100 percent payback...nothing more nothing less..

[sheilaE]

Did you take in account for the Nat'l Standards for your groceries, utilities, car maintenance, home maintenance, gas, clothing...the trustee isn't going to make you starve. The payment comes about after the monthly living expenses are accounted for, unless you are wanting to keep something like a boat, RV, vacation home, if not then you need to claim ALL your expenses.

[enginegirl]

Hi DeeDee,
Here is a link to the means test...http://www.legalconsumer.com/bankrup...st+Allis%2C+WI
I did a quick run through the numbers based on the info you provided above and used Milwaukee as the area (was not sure of your car payment etc.) and it does look like your dmi is around $1500.00.. the new laws may help you regarding the 6 weeks of no pay in the summer.... ask your Lawyer about the "Lanning" law (here's the link from the sticky!
http://www.supremecourt.gov/opinions/09pdf/08-998.pdf)

as far as the budget allowed for food/utilities etc... it is all included in the means calculator for your specific area... and I know that it feels harsh to live on such a small amount..... I can speak for myself that I was shell shocked for the first couple of months... but it is do-able.... (I love good food and wine and I scrimp in places so be able to afford a little something once and a while).
Good luck to you...

[deedee642]

National Standards

deedee642-do you HAVE to file now? We retained our atty last March, then found this forum and LEARNED sooooo much. If you have time, don't rush into signing ANYTHING. Our atty never even told us about that Nat'l standards and all the allowable expenses and had us at a high payback as well. There's no way you should be left without the funds to pay your mortgage or be able to buy food. If you post your financial numbers on here, then there are people who are very educated in 13's, that help you figure it all out.

I actually fired my attorney. I was suppose to file in November, so now I am just scrambling. I live in Milwaukee. What were some of the National standards that you learned about? My attorney had small allowances for groceries, utilities, etc. What did your payback adjust to? Thanks for the reply.
Dee

[Pandora]

I owe $120,000 on my condo; however, I am upside down by about $30,000 because of the market.
My attorney did not include the condo in the bankruptcy.

Plan was to pay $89,323 (car & credit cards/installment loans/personal loans) + (trustee/legal fees) over 5 year period 100% payback.
$1,488.73 a month
He listed my current montly income as $5,936 before taxes.
I clear about $2100 a pay period
However I have to pay about $1500 for mortgage/taxes/homeowners fees
I also am paying back a 403b loan.
I have to save money from each check because I do not get any pay for six weeks in the summer.
Student Loan = $240.00 a month
Cable, utilities, groceries, etc.
I have money taken out of my check for a 403B and also a health flexible savings plan

DeeDee

Unless we know actual numbers for items you're claiming (groceries, utilities, medical, etc etc etc) we cant help you figure out anything. Its hard to go off of some numbers while not having the others, so you'll have to calculate it yourself using the means test and IRS standards for expense allowances. If your lawyer didnt include your mortgage, is it because its being paid outside the plan or are you giving it up? Student loan wont count in a Ch. 13 - its deferred, so you cant list it.

There are too many unknowns at the moment, however just based on what you wrote (plan is all unsecured except car note) - is there a reason why you're filing then if you're in a 100% payback? Is it cheaper for you to pay a Ch. 13 plan than continuing to pay all of these items on your own? Things to think about....

[deedee642]

I fired my attorney. I am in the process of trying to get my paperwork back from him, so that I don't have to spend all those hours gathering all the information up again. He is basically holding my file hostage. He says it is the property of his office. I am also trying to get some of my $800.00 back. I asked for the filing fees back since he never filed on my behalf. He finally said (last week) that he would send me a check this week. I have not received anything. I can't afford a new attorney right now. So I am just trying to educate myself before moving on. Thanks for your reply. I wish that Chapter 13 was not so complicated.
Dee

[Pandora]

http://www.justice.gov/ust/eo/bapcpa/20101101/meanstesting.htm

all of the info you need is located here.... median income, food standards, utilities, etc.

[Rebel]

My husband and I just recently decided to file chapter 13, and I will be posting some questions of my own soon , but in regards to the 100% payback, is my understanding correct that a Chapter 13 filing is more beneficial to paying back the Creditors on one's own because, in Chapter 13, the interest charges would disappear?

[jetsfan2010]

Rebel,
You in essence freeze the balances from going up, so as long as you pay according to the plan, you actually can see an "end in sight"