Means Test - Passing, but increase in income after 6 month lookback period

[bornfree2]

This is why people hire an attorney. The Means Test was a disaster since it was introduced. There probably has been more litigation related to the means test, since 2005, than any other part of the code since the same period.

The presumption of abuse arises when the DMI is greater than $136.25 (as of 4/1/2019). A debtor can "overcome" the presumption of abuse if that don't have the means to pay 25% of the unsecured debt. But, and this is the kicker, once the DMI reaches $227.50 (as of 4/1/2019), the presumption can not be overcome.

So, technically your DMI should be $136.25 or less (as of 4/1/2019). If it is more than $136.25 but less than $227.50 (as of 4/1/2019), then you can overcome that presumption so long as you can't pay at lest 25% of the unsecured debt.

Yes, it's complex and this is where most fall into the dismissal (or conversion) scenario.

The definition of "presumption of abuse" just means that the debtor is said to be abusing the goal of a Chapter 7 and that the debtor could afford to pay their (unsecured) creditors a premium (something).
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Im trying to chew on what you wrote slowly so as to understand. Lets say someone has $50k in debt. 25% would be $12,500.

So you are saying if the money they have left over after expenses (DMI?) is more than $227.50, then they MUST be moved into chapter 13?

In which case, they make you pay that $12,500 over 4 years? so payments of $260? And if you miss it even once, then what happens? Does it also carry interest? And for what aim? You bust your back and cant work at all, then what, too bad so sad no BK option for you? None of it is deductable. There is ZERO pathway to restoring a person financially this way. Its only squeezing them into a corner and making them a debtor once again. But again Ammmerikkka what am I complaining about right?

All this does is promote suicides, broken families, communities without investments. But hey, put on a smiley face cause 'stimulus' is coming your way...'health care for all'....and look bitcoin--to--the--moon. Its one big casino run by banksters bought and paid for.

What an utterly ruinous policy for the long term health and strength of our country.

(sad trombone )

[flashoflight]

Well the median test is $66k in california for my case, so minimum wage would come nowhere near that.

But then im reading that is just the first test, they get you on the second. Anyways much more for me to read on this. So so many traps along the way. Its rather shameful how lobbying got in there and hijacked this for the creditors advantage. Im sure i will live to see the day they lobby to harvest the poor man's blood and organs to pay off some of the interest. Ammurikaa!

Nobody is going to care about below median debtors. You are fine. There isn't going to be a bad faith/totality of the circumstances situation for you. Absolutely no chance. Your eventual case will be a quick 5 minute read by the trustee and that's it. Most below medians are actually terrible candidates for referral to 13s because the repayment plans are often determined by the ch13 trustee to be infeasible due to lack of employment income. Below medians trying to save a house in 13s do tricks like pretend to get $500/month from grandma for 5 years to help pay mortgage arrears and delay the inevitable foreclosure. The ones that don't do the pretend grandma trick will get a 2nd or 3rd job with Uber/etc. to try to raise their income to make a repayment plan feasible. You know anyone who has driven for Uber for five years straight without income going down and getting enough sleep between job#1, job#2, and job#3? Chapter 13 and below median don't mix.

There is a misconception that above medians and way above median are forced to do a 13. You can squeeze into a 7, but it takes more pre-planning and strategy to get into a 7 the further I am from median income. The means test has to be passed. The I/J has to leave nothing to unsecured creditors. And it can't be a bad faith filing. That's when I hired the best consumer BK lawyer in the area and have paid a lot of coin to him. I did a lot of the pre-planning work myself so some it felt like I was doing a ch13 pro-se. There has been an adversary proceeding, delays tactics with the 8 lawsuits I had, a motion to avoid lien, and more. I got a great result, but it could have been real bad. You take the hand you are dealt with and do the best you can with the help of great debtor's counsel. Don't spend time being angry at the rules of the game. Try to win the game despite the rules.

[bornfree2]

There is a misconception that above medians and way above median are forced to do a 13. You can squeeze into a 7, but it takes more pre-planning and strategy to get into a 7 the further I am from median income. The means test has to be passed. The I/J has to leave nothing to unsecured creditors. And it can't be a bad faith filing. That's when I hired the best consumer BK lawyer in the area and have paid a lot of coin to him. I did a lot of the pre-planning work myself so some it felt like I was doing a ch13 pro-se. There has been an adversary proceeding, delays tactics with the 8 lawsuits I had, a motion to avoid lien, and more. I got a great result, but it could have been real bad. You take the hand you are dealt with and do the best you can with the help of great debtor's counsel. Don't spend time being angry at the rules of the game. Try to win the game despite the rules.

Thank God for you BK studs on here. I appreciate your advice and encouragement always. Im taking your advice to heart (re getting a job first before BK) it sounds obvious but with so much mind fog through this thing and my own lawsuit now, im doing the best I can. Def having a job will do wonders to my continual obsession over this.

[justbroke]

So you are saying if the money they have left over after expenses (DMI?) is more than $227.50, then they MUST be moved into chapter 13?

I'll keep saying that if you're under-the-median, you'd have to really have a significant amount of disposable monthly income (DMI), but that's usually impossible mathematically!

In which case, they make you pay that $12,500 over 4 years? so payments of $260? And if you miss it even once, then what happens? Does it also carry interest? And for what aim? You bust your back and cant work at all, then what, too bad so sad no BK option for you? None of it is deductable. There is ZERO pathway to restoring a person financially this way. Its only squeezing them into a corner and making them a debtor once again. But again Ammmerikkka what am I complaining about right?

For an over-the-median filer, that could be the case. It doesn't make them a debtor again. Think about this... I discharged well over $1M in a Chapter 13. I paid my unsecured creditors close to nothing (0.1% or something like that). How am I a debtor again? I literally settled for $0.01 on the dollar.

All this does is promote suicides, broken families, communities without investments. But hey, put on a smiley face cause 'stimulus' is coming your way...'health care for all'....and look bitcoin--to--the--moon. Its one big casino run by banksters bought and paid for.

Bankruptcies are what prevents those issues. It allows a deserving debtor to immediately discharge all their debt (Chapter 7) or to cure arrearages for a mortgage and save a home.

Bankruptcy is a blessing to most!