Have lost all hope.

[lrprn]

Ok, I just figured out Schedule J and I vs the means test from searching on the site. This site is awesome by the way!

My question for J is how many months must you show receipts? If we stop paying the cc's and use that money for food, clothes, get myself some health insurance ( I currently have none)....we will not have any disposable income.

If I do keep paying the cc's, won't the 400-500 worth of cc payments show up as disposable income?

How do I work this so that the numbers will line up for my chapter 7? We are still 6 months away from filing. I planned on making cc payments until then but if it will screw up the disposable income part of our BK, I'll do whatever we need to do not to mess it up.

Emmy, it sounds like you need the money to pay for a lawyer and for car repairs, buying clothes, purchasing health insurance, etc. that you've put off for a while trying to pay your debts. The $400-500/mo can get eaten up that way for the next six months.

Paying your cc's up until you file does nothing for your case and won't make it go easier. It's just throwing away your good money to pay against something that will be wiped out in six months anyway. Far better to use that money to catch up on the legitimate living expenses you've been doing without for a long time.

[whatamess]

Huh?

I have been trying to keep up my minimum payments by forgoing everything we need and eating cheap food. I have three pairs of pants for heavens sake!
My minimum on one card is $475 a month where as the others are $55, $199 and $100. I havent seen a dentist in a few years, so should I be doing those things rather than paying on the card? Wont they garnish my husbands wages? We were only three weks late on a loan (the $475) and they told uis we were going into collection in two more weeks!!! They said legal action would be taken in eight weeks. So if I continue to pay $475 and the others less we will have to go to court even though they were minimum payments??

This is such a headache. If I ever get another cc again in my life I hope my hand catches fire. Really.
Its bad enough we wont have our tax return I suppose next year, a $4,000 check between EIC and low wages from a crappy federal job. We depended on it every year. Our only TV left blew up last night! I really hoped to buy a few things like a Tv, some clothes & pay for some dental work.
UGH!!!
Whatamess.

[Emmy]

You don't have to show any receipts initially. May never be asked to show receipts at all. Just depends on the wind, whether or not the Trustee has a bad hair day, if the Courts come down with some odd opinion,.......... Just suggesting you save receipts so you'll know what to tell attnys you spend for things. And as a CYA in case you get asked to verify some sort of expense.

Yep! You are right about the CC's payments money becoming disposable income every month. When you file BK, you don't include in your monthly expenses any debt you plan to discharge.

If you quit paying your payments today, what would you use that money for??

Maybe to buy the Health Ins you mentioned. I'd bet you've hardly been buying any clothes for a while and when you do, you pay with a CC. Do you buy groceries with a CC?? Pay cash instead.

Do you need to go to the doctor, dentist?? Car repairs?? House repairs?? Anything you've been putting off because you don't have the money, start taking care of those needs.

The Court doesn't mind necessities. Just don't go taking a lavish vacation with the money.

Also, you're gonna need money for filing fees, pre and post BK Certs, and attny's fee.

Plus, any Creditor that you pay in excess of $600 total to in the 90 days prior to filing BK, the Trustee is going to go back to those Creditors to get that money back. You may be required to appear in Court to explain those payments. Overall, just best not to go there if you can avoid it.

Yes we would use the cc payments for all of those things and maybe still not have enough left over to get all that we need. Sometimes I wonder how we are making it right now.

Okay so receipts are not mandatory when you turn in the schedule J but they could ask for them at anytime. So for example, we spend about $100 or so a week for groceries. If they question that and ask for receipts, how many weeks worth will they want? Will they say, "Let us see a couple of your weekly gorcery bills" or will they ask fo 3 months worth?

How do you figure expenses that aren't montly on J but are still needs? Like bedsheets, we haven't bought new ones in maybe 3-4 years but I'd guess most folks would buy some every 6 months to a year? Say new sheets cost a $150 a year would you just divide it by 12 and put that amount on J as the monthly portion for sheets?

One last question, (for this post anyway! ) how much does bk cost in general? How much is the average total cost if you have a bk lawyer do it?

Thank you so much for all the welcomes and advice so far! It feels so good not to be alone, you all don't know how much I already appreciate this forum.

[HHM]

If you are going to be declaring BK anyway, then paying your monthly minimums on credit cards is throwing good money down the toilet. The threat of lawsuit is just saber rattling. If its a standard, national credit card, lawsuits don't typically get filed for 6-18 months...(its too costly), they would rather go through several rounds of cheap, non judicial collection.

If I were you, if your overall financial situation warrants it...go ahead and get the BK rolling, then AFTER the BK is complete (if its a chapter 7, or after plan confirmation if its a Chapter 13) go out and get a TV and dental work.

[lrprn]

I have been trying to keep up my minimum payments by forgoing everything we need and eating cheap food. I have three pairs of pants for heavens sake!
My minimum on one card is $475 a month where as the others are $55, $199 and $100. I havent seen a dentist in a few years, so should I be doing those things rather than paying on the card? Wont they garnish my husbands wages? We were only three weks late on a loan (the $475) and they told uis we were going into collection in two more weeks!!! They said legal action would be taken in eight weeks. So if I continue to pay $475 and the others less we will have to go to court even though they were minimum payments??

This is such a headache. If I ever get another cc again in my life I hope my hand catches fire. Really.
Its bad enough we wont have our tax return I suppose next year, a $4,000 check between EIC and low wages from a crappy federal job. We depended on it every year. Our only TV left blew up last night! I really hoped to buy a few things like a Tv, some clothes & pay for some dental work.
UGH!!!
Whatamess.

We all feel your frustration, whatamess.....most of us have been right where you are right now.

You should only stop paying your credit cards if you are absolutely committed to filing bankruptcy and plan to do so within six months.

Going into collections just means you are headed into 4-6 months of having your phone ringing off the hook being pestered to pay what you owe...verbal threats, that's all. Garnishment based on unsecured debt like credit cards and non-secured loans means the company has to take you to court - something that typically takes at least six months to get into motion, often much longer than that. (Secured debt is different - most mortgage and car companies will start repossession efforts in motion after two missed payments.)

It's late for this year, but you can adjust your withholding at any time. Here's a great link to IRS forms that help you figure out how much to withhold to get your amount withheld as near to zero as possible - http://www.irs.gov/pub/irs-pdf/p919.pdf . Well worth a visit for everyone who files bk to ensure your refund is as close to nothing as you can make it if your trustee is taking your tax return, he/she won't have much to take .

[SinkingFast]

Okay so receipts are not mandatory when you turn in the schedule J but they could ask for them at anytime. So for example, we spend about $100 or so a week for groceries. If they question that and ask for receipts, how many weeks worth will they want? Will they say, "Let us see a couple of your weekly gorcery bills" or will they ask fo 3 months worth?

How do you figure expenses that aren't montly on J but are still needs? Like bedsheets, we haven't bought new ones in maybe 3-4 years but I'd guess most folks would buy some every 6 months to a year? Say new sheets cost a $150 a year would you just divide it by 12 and put that amount on J as the monthly portion for sheets?

One last question, (for this post anyway! ) how much does bk cost in general? How much is the average total cost if you have a bk lawyer do it?

Thank you so much for all the welcomes and advice so far! It feels so good not to be alone, you all don't know how much I already appreciate this forum.

The only people who've posted here that were actually asked to show receipts were people filing after their businesses died. Former owners of S corps, or similar business set-ups, who could bring their business debts in under a Personal BK.

There have been some people asked to show the last 6 months to a year of CC and/or bank statements. Generally that's when you run up a lot of debt in a very short period of time. Also, in excess of $100K in unsecured debt can be a red flag for the Trustee or the US Trustee's office. Depends on your particular totality of circumstances. If you had a job loss and took a new job for less money. Had major medical expenses. Things like that.

When we met with our attny, I told them $75/mo for home maintenance. That's what I fig'd I had spent for new bed linens, bath linens, curtains, and such in the last year. We are currently renters. Our attny entered our Schedule J with $0 for Home Maint. I guess renters here are not allowed that expense.

Yep, that's exactly how you get a number for those things. Take the amount the items cost, how many you'd buy, add it all up, and divide by 12.

Here's a link to a BK Expense Calculator for you:

http://www.ca-bankruptcy-attorneys.c...alculator.html

This will help you think of lots of everyday expenses many of us forget to include in our budgets.

[Emmy]

Thanks Sinkingfast! We are also renters so we won't be able to put anything for home maintenance either. Were you able to put thoses expenses in another category? I've looked over the J schedule and everything is specific like food, clothes. I don't see anywhere to put the things you've mentioned that didn't fit into home maint or a category for things like pet food, shampoo, toliet paper. Kind of strange that those type things aren't on there but magazines are.

[rrockinggramma]

You mentioned in your original post that you are a midwesterner. I am in Michigan. When I filed my chapter 7 (01) tax refunds were not taken in the Eastern District. However, they are if you file a chapter 13. When you talk to your attorney, ask what the local Bk rules are in your area regarding taxes. Our first lawyer told us to get the refund, spend it, and then file (for our chapter 13) and that is exactly what we did. Good luck and it will all be ok. And quit paying on any bill that would be discharged in your BK. That is like throwing money out the window. Good luck!

[Grace]

I don't know anyone who buys new sheets every year, certainly not every six months. And $150? Holy cow! I bought a set of sheets many years ago that were close to a $100, and I see no need to replace them any time soon. Just my opinion and observation. I would think $150 sheets every year would be an unreasonable expense. Heck, my grandmother has sheets that are easily 10-15 years old. Definitely spend money on things like health care and dentistry. Those are the important things.

[CATCHMEIFYOUCAN]

Buying a New/Used Car ?

Just skimmed through the post really quick, anybody mention to Emmy about buying a new/used car? It will be hard for you to incur any debt once you file (especially if you want to get a reliable car). Unfortunately my car got flooded just before I filed, so I go myself into a new car, and had only made one payment by the time I got to my 341 meeting. What about considering filing after you receive your tax refund? Sounds like thats what your considering doing? I don't think the trustee can go for it after the fact, especially if you use it for reasonable expenses. Receipts, hmmm .. I would think you need them as proof if you spend more than the IRS standards. If you use a regular checking account, that would show what your spending your dough on. Anyways, just my thoughts!

Best wishes, Catchmeifyoucan

[Emmy]

Thanks all! I don't spend $150 on sheets! lol I was just guessing at what normal people spend, so my guess must be off. I've looked at the irs allowable so I can see now what can be considered reasonable.

We are planning to wait until our tax return is filed and spent. We have to wait anyway as to put some time on our cc where we haven't charged.

I'm still debating on if I will quit paying on the cc's until right before I file. I'd like to keep paying the minimums so that our score will be the least damaged coming out on the other side. (that is what I've gathered from reading here)

That is also what causes my receipt worry. If we are paying on the cc's up until we file then we will be budgeting hard core and NOT spending what we might normally buy on groceries or whatever during the month.

I have no worries that we would spend all of our income on resonable expenses with no disposable left over but that won't happen until we actually file for bk and use the cash we'd spend on paying cc's on normal monthly expenses.

Are you allowed to put dental expenses on schedule J if you've been using a cc for them? I also don't have the orginal receipt but it is on he cc statement, is that good enough for them? The same would go for clothes for our kids, we put them on a cc every winter and spring. My cc statements would the receipts.

[miss puff]

I don't know anyone who buys new sheets every year, certainly not every six months. And $150? Holy cow!

ummmm, eerrr, wwelllll..... Grace, did you happen to read my "IF money wasn't an issue" thread in General talk? LOL However, I am bankrupt and this may have been a contributing factor. But WOW, they sure are soft. haha

[SinkingFast]

People here aren't saying they buy new sheets every year. Many of us broke folks have thread bare linens that need to be replaced. We are looking to categorize those "types" of expenses.

Renters do have home maintenance costs. Bed and bath linens definitely are not clothes. What about the coffee maker that goes kapooht?? Or the microwave you have to replace? If you rent a home where kitchen appliances are not provided and you have to purchase those??

When we moved into this condo, we needed new shower curtains. The homes we'd lived in before had glass doors.

Our attny did not list a home maintenance expense on our Schedule J, so I have no clue where he pushed those types expenses to.

[Grace]

Things like shower curtains, sheets, curtains, coffee maker, etc. are things that most people need to buy at some point regardless of whether you rent or own. They're not house maintenance expenses. I would think that would just include things like a new roof, furnace, plumbing repairs, exterior paint. Stuff like that. If you have to purchase actual kitchen appliances as part of renting, like refrigerator and stove, then maybe you could add that.

[SinkingFast]

Things like shower curtains, sheets, curtains, coffee maker, etc. are things that most people need to buy at some point regardless of whether you rent or own. They're not house maintenance expenses.

Well I beg to differ. And I'm sure other folks here would too.

Things people buy for the household are HOME Maintenance items.

A coffee maker, can opener, and cooking utensils are not groceries.

Bed and bath linens, and curtains/blinds are not clothes.

Those things are part of home maintenance. They are not durable goods. They do wear out. Yet we aren't allowed to claim them anywhere in the budget on Schedule J.

If you don't consider those types of expenses to be Home Maint, how would you categorize them??