Newbie in Texas needing advice on Chapter 7

[NowImDownInIt]

You say you have dependent care as a deduction on your check?

I really don't see how you would qualify for a Ch. 7 with your income. You WILL have to include your wife's income in the filing as it is household income. Y'all are WAY above median for a 3 person family here in Texas. (I'm a 3 person family in Texas)

I would tell youf wife ASAP, she will be much more pissed off if you keep it from her.

Let us know what the attorney says.

[texanboy76]

You say you have dependent care as a deduction on your check?

I really don't see how you would qualify for a Ch. 7 with your income. You WILL have to include your wife's income in the filing as it is household income. Y'all are WAY above median for a 3 person family here in Texas. (I'm a 3 person family in Texas)

I would tell youf wife ASAP, she will be much more pissed off if you keep it from her.

Let us know what the attorney says.

Yes dependent care goes into an account and takes out like $250 per pay period (total of $5000 per year) and goes into a seperate account. I still have to pay my daycare costs for my daughter which is $1240 per month and so basically I pay out of pocket $9880.00

If you say we are WAY above the means then help me understand what they would take in a chapter 13 filing? There would be about $300 left after we take out all the expenses per month.

[PoGirl]

Texan here, also in Dallas area - 4 person family - also above the means test so we're doing 13.

Could you clarify your question " . . . help me understand what they would take in a chapter 13 filing?"

[PoGirl]

I've listed my scenario below and I'm curious if the BK is a public record where friends or family could find out?

<i>Yes, public record.</i>

Also the only thing that my wife and I are joint on is a loan with my credit union and one of the cars.

<i>When you complete the paperwork, you have to list ALL of your debt, so the joint debt would be listed as well.</i>

Everything else including the mortgage is under mine. I don't have any equity in my home as I was under a 3-1 arm and did a refi this year.

<i>This is probably a good thing for a 13.</I>

Also I have an AMEX card since 2001 that is a charge card and the nice thing about this is that I've always made payments and NEVER been late or carried a balance. Will they still let me keep my card open?

<i>No. They will most likely close the account.</i>

The breakdown is this: STATE OF TEXAS
Gross Monthly Salary: $7100.00 (mine only)
Net of $4500.00 (my salary)
Mileage for car Net of $1200.00
Wifes Net Salary $2500.00
Total $8200.00

My net is after Health insurance,401 K and credit union loan, dependent care account

<i>You can count the health insurance and 401K contributions as expenses. I'm not positive about the dependent care account, but I would think that would be a valid expense since you would be paying the full amount out of pocket if you didn't use the dependent care account. I have an amount deducted from my paycheck for the medical reimbursement account and that has not been an issue for me.</i>

Mortgage is $2900.00 (my name only)
Daycare is $1240.00
Car Note (2) is $1500.00 (my wife and I $750 joint and $750 on my own)
Property Tax $1300.00 (we dont escrow) paid at end of year
credit card bill payments of $2000.00 + for myself (about 105K in unsecured debt)
wifes credit cards of about $800.00

When i did the means test it failed saying I had disposable income left????? How is that possible when I'm filing single and all of those payments I'm responsible for.

<i>Be sure you are accounting for ALL your expenses when you do the means test. When I did the means test myself, I had about twice left over compared to when my attorney did it. Think about those things that don't come up every month - hair cuts, clothing, new tires, etc. and include those as well. </i>

[texanboy76]

I've listed my scenario below and I'm curious if the BK is a public record where friends or family could find out?

<i>Yes, public record.</i>

Also the only thing that my wife and I are joint on is a loan with my credit union and one of the cars.

<i>When you complete the paperwork, you have to list ALL of your debt, so the joint debt would be listed as well.</i>

Everything else including the mortgage is under mine. I don't have any equity in my home as I was under a 3-1 arm and did a refi this year.

<i>This is probably a good thing for a 13.</I>

Also I have an AMEX card since 2001 that is a charge card and the nice thing about this is that I've always made payments and NEVER been late or carried a balance. Will they still let me keep my card open?

<i>No. They will most likely close the account.</i>

The breakdown is this: STATE OF TEXAS
Gross Monthly Salary: $7100.00 (mine only)
Net of $4500.00 (my salary)
Mileage for car Net of $1200.00
Wifes Net Salary $2500.00
Total $8200.00

My net is after Health insurance,401 K and credit union loan, dependent care account

<i>You can count the health insurance and 401K contributions as expenses. I'm not positive about the dependent care account, but I would think that would be a valid expense since you would be paying the full amount out of pocket if you didn't use the dependent care account. I have an amount deducted from my paycheck for the medical reimbursement account and that has not been an issue for me.</i>

Mortgage is $2900.00 (my name only)
Daycare is $1240.00
Car Note (2) is $1500.00 (my wife and I $750 joint and $750 on my own)
Property Tax $1300.00 (we dont escrow) paid at end of year
credit card bill payments of $2000.00 + for myself (about 105K in unsecured debt)
wifes credit cards of about $800.00

When i did the means test it failed saying I had disposable income left????? How is that possible when I'm filing single and all of those payments I'm responsible for.

<i>Be sure you are accounting for ALL your expenses when you do the means test. When I did the means test myself, I had about twice left over compared to when my attorney did it. Think about those things that don't come up every month - hair cuts, clothing, new tires, etc. and include those as well. </i>

thanks for giving answers to some of my questions. Here is a breakdown of what I did for my attorney tomorrow:

husband $4,400
Wife $2,500
husb car $2,000

NET TAKE HOME $8,900


Expenses

$2,900 Mortgage
$300 electric
$120 cell phone wife
$1,200 day care
$1,500 car payments
$120 water
$1,400 credit cards (wifes)
$120 homeowner dues
$60 yard
$170 house cleaners
$123 life insurance policy
$300 car insurance/floater
$100 verizon/tv/phone
$1166 property tax (don't escrow)
$600 Food/Groceries


I'm really scared.........

[PoGirl]

It can be scary, but I will tell you that I felt a huge sense of relief once my husband and I decided to file. We struggled with the decision for such a long time (10+ years) and finally deciding to take this step made us feel much better. Yeah, it still sucks, but it is what it is and it's nice that the two of us are working together to fix the problem instead of fighting about the problem. I, too, am the one that ran up a lot of the debt and tried to hide it. I had to come clean. It was hard.

Here are some additional expenses you want to think about:

-home maintenance (not just the yard - think about stuff you have to fix from time to time)
-clothing
-laundry and dry cleaning
-medical and dental expenses
-transportation (not including car payments) Think about gas, oil changes, registrations, inspections, etc.
-recreation (eating out, movies, magazine subscriptions)
-charitable contributions
-insurance (homeowners if not included in mortgage payment), health insurance, auto, etc.
-taxes not deducted from wages or included in mortgage payments
-installment payments (list those that you don't plan to put into the 13. For example, we are keeping one of the cars outside the plan)
-personal grooming
-alimony, maintenance, child support, if applicable
-regular expenses from operation of a business, if applicable

For your life insurance, they won't allow you to count whole life. You can count term.

Also, there are maximums that you can use in each category. For example, we were only allowed $500 for food for a family of 4., so the laundry and dry cleaning category helped cover some of those paper goods (diapers are EXPENSIVE - LOL!)

Hope that helps!

[texanboy76]

It can be scary, but I will tell you that I felt a huge sense of relief once my husband and I decided to file. We struggled with the decision for such a long time (10+ years) and finally deciding to take this step made us feel much better. Yeah, it still sucks, but it is what it is and it's nice that the two of us are working together to fix the problem instead of fighting about the problem. I, too, am the one that ran up a lot of the debt and tried to hide it. I had to come clean. It was hard.

Here are some additional expenses you want to think about:

-home maintenance (not just the yard - think about stuff you have to fix from time to time)
-clothing
-laundry and dry cleaning
-medical and dental expenses
-transportation (not including car payments) Think about gas, oil changes, registrations, inspections, etc.
-recreation (eating out, movies, magazine subscriptions)
-charitable contributions
-insurance (homeowners if not included in mortgage payment), health insurance, auto, etc.
-taxes not deducted from wages or included in mortgage payments
-installment payments (list those that you don't plan to put into the 13. For example, we are keeping one of the cars outside the plan)
-personal grooming
-alimony, maintenance, child support, if applicable
-regular expenses from operation of a business, if applicable

For your life insurance, they won't allow you to count whole life. You can count term.

Also, there are maximums that you can use in each category. For example, we were only allowed $500 for food for a family of 4., so the laundry and dry cleaning category helped cover some of those paper goods (diapers are EXPENSIVE - LOL!)

Hope that helps!

yes those are excellent and I will ad those to my spreadsheet! MY question is if I try and file chapter 7 are they going to make me get rid of my house or cars? I'm worried they will say we are living above our means but we can make all the payments we need to (will cut in many places to save) but I want to ensure we can keep our home. We dont have equity in the home (maybe $3,000) because we were on a 3-1 arm and everything went to interest instead of principal. I'm so confused after reading and searching the forums it seems like there are so many scenarios and you're not sure where you fit in. I guess 9:00 tomorrow can't come any sooner

I think my only positive is my attorney (personal BK) is top-notch in the Dallas area and was recommended by the top 3 law firms that handle Corporate BK.

[PoGirl]

I think your income may be too high for you to go the 7 route. That certainly was the case for me.

I think you can keep your house in a 7, as well as the cars, since you are in Texas. That was the impression that I got from our attorney. But, since my income was too high, that pushed us to a 13 right away.

Depending on the age of your cars, the attorney may advise you to include those inside the plan as well. We are putting one in and keeping the newer one out. We'll be making our mortage and one car payment outside of the plan and the other car will be inside.

There ARE so many scenarios. There are differences by state and by individual situations, which is why having a good attorney is such an asset. But, having heard all the different scenarios is a good thing too, becuase it helps prevent surprises and makes it easier to discuss options with the attorney, in my opinion.

Have a beer, kiss your wife and get some sleep. There's nothing more you can do tonight to make it better. You will feel much better after speaking with your attorney because you'll have answers and some options.

[NowImDownInIt]

Yes dependent care goes into an account and takes out like $250 per pay period (total of $5000 per year) and goes into a seperate account. I still have to pay my daycare costs for my daughter which is $1240 per month and so basically I pay out of pocket $9880.00

If you say we are WAY above the means then help me understand what they would take in a chapter 13 filing? There would be about $300 left after we take out all the expenses per month.

$300 a month, after all expenses are paid, is enough to fund a 13 plan, and they will take what they can get. You would keep your house and cars, if you so choose.

[RedLight]

Everything budget wise looks pretty good. Unfortunately, in the State of Texas, especially, DW will find out.

[momof5]

. I know this sounds bad but I'm trying to file without DW knowing about I had some problems with why this debt occurred which could cost me my marriage if you know what I mean

Regarless of why you are in a position now of needing to file Bk your wife needs to know. Period. This is not something you can hide. Your worried about it costing you your marriage but can you imagine whats going to happen when she finds out you filed for Bk and didnt have the courage to tell her?

She makes a good income and does not seem to be dependent on you for everything so you might want to do some soul searching here. She is bound to find out somehow (mail,phone,online,friends....) especially if you live in the same household. This will be what ultimately ends up costing you your marriage.

Sorry to sound so harsh but you have to deal with reality before you can proceed. I just dont want to things get worse for you... like needing to file BK while you are in the process of a divorce.

[texanboy76]

Everything budget wise looks pretty good. Unfortunately, in the State of Texas, especially, DW will find out.

please explain as the lawyer said you can file without her knowing. the only thing we are joint on is a car and signature loan. Those aren't going to get thrown in the BK and we will continue to make payments as normal.

[PoGirl]

Texan - I haven't filed yet so I can't speak to how much mail will come. I can tell you that the phone hasn't stopped ringing. So, had I been trying to hide it from my DH, so far I would have found it very difficult.

I am certainly not in a position to judge and you ultimately have to decide the best way to handle the situation. I know nothing of your personal relationship with your spouse and only you know how she will react. But, I will say that the stress of dealing with BK combined with hiding the debt on top of keeping everything from your wife is a lot to handle. You may have the stomach for it, but I know that I don't.

On another topic - do you feel better now after meeting with the attorney? Did you get some of the options and answers you needed? Hopefully you are a little less worried than last night.

[texanboy76]

Texan - I haven't filed yet so I can't speak to how much mail will come. I can tell you that the phone hasn't stopped ringing. So, had I been trying to hide it from my DH, so far I would have found it very difficult.

I am certainly not in a position to judge and you ultimately have to decide the best way to handle the situation. I know nothing of your personal relationship with your spouse and only you know how she will react. But, I will say that the stress of dealing with BK combined with hiding the debt on top of keeping everything from your wife is a lot to handle. You may have the stomach for it, but I know that I don't.

On another topic - do you feel better now after meeting with the attorney? Did you get some of the options and answers you needed? Hopefully you are a little less worried than last night.

Pogirl,

met with the attorney and got alot of questions answered. He is one of the top BK lawyers in the Dallas area and said chapter 7 was a no brainer. At the end of the day he told me to wait until after I get my return to file. I'm the very first to do that with my CPA. None of the companies have my home phone number as my cell is the only thing listed on my information. I'm with you about the process and stress this can produce but I'm not sure I can tell her immediately what is going on.

The meeting really made me feel at peace.

[PoGirl]

The meeting really made me feel at peace.

Good! I was sending good vibes your way that you would get some peace. Glad to see it worked!