Secured or Unsecured? That is the question!

[craigerzz]

I'm trying to figure out the difference between secured and unsecured. The excellent form7 software doesn't have the specific answers I'm looking for.

1. Student Loans i listed under unsecured? is this the right way to do it?

2. My wife had a car reposessed about 4 years ago and I'm listing that under the unsecured debt too, should this go under secured?

3. I will be officially unemployed at the time of my filing. In fact, I'm filing the day after my last day at my present job. Should I include my income from my old job when figuring in expenses for the schedules? I'll probably have a new job by the time I get to my 341...any ideas here?

Ah, I'm not a mastermind when it comes to finances, but the form7 software is really excellent to use so far. I've been impressed with how easy it is to use. Any answers to the above questions or pointing me in the direction of the right answers would be much appreciated.

Thanks,
Craigerzz

[originalhealer]

Something is secured when the bank or finance company has something that they can take if you don't pay. If they took it already, it's not secured anymore.

1. Therefore, student loans are unsecured. There is nothing for them to take, except maybe to garnish your check!

2. The car was already repossessed, and they should have applied what they got for it at auction to your balance. What is left is unsecured.

3. You only list your income and expenses As Of the Day of Filing. Anything you earn after you filed, even the next day, doesn't count, unless it is an inheritance or something like that.

Use the NOLO book as a guide while using the software. Hope this helps!

[StaciMM]

I 2nd everything Original Healer said! I was confused by student loans too-figured that since they're not dischargeable they would go somewhere special on the forms. They just go in w/ the other unsecured accounts. That way, they get notice of the automatic stay.

Regarding income, there is one place to enter your income year to date, and for the prior 2 years. Be ready to explain to the trustee why your YTD doesn't match your income schedule, but that is a pretty simple explanation. I believe it is standard for the trustee to ask (at 341 hearing) if your finances have improved. Will getting the new job give you extra disposable income?

[craigerzz]

another job

Dont know, most likely a new job where I'm going will not improve my financial situation. However, the cost of living is a lot less expensive! Thanks for the information you guys have supplied me on here, I really appreciate you help!

Craigerzz

[StaciMM]

Good luck! If you do start the new job prior to the 341, you could always amend your income schedule. I think the only time there is a charge for an amendment is if you're adding creditors.

[HHM]

I'm trying to figure out the difference between secured and unsecured. The excellent form7 software doesn't have the specific answers I'm looking for.

1. Student Loans i listed under unsecured? is this the right way to do it?

2. My wife had a car reposessed about 4 years ago and I'm listing that under the unsecured debt too, should this go under secured?

3. I will be officially unemployed at the time of my filing. In fact, I'm filing the day after my last day at my present job. Should I include my income from my old job when figuring in expenses for the schedules? I'll probably have a new job by the time I get to my 341...any ideas here?

Ah, I'm not a mastermind when it comes to finances, but the form7 software is really excellent to use so far. I've been impressed with how easy it is to use. Any answers to the above questions or pointing me in the direction of the right answers would be much appreciated.

Thanks,
Craigerzz

1. Yes, student loans are general unsecured debts

2. Yes, its an unsecured debt because you no longer have any interest in the propert that secured debt. Deficiency balances are always general unsecured debts.

3. Why would having a job or not having a job affect your expenses. Certainly it affects your income, but most people's expenses are relatively fixed. Just put down what you actually spend for the various categories of expenses.

[craigerzz]

Thank you very much for the information, it's truly appreciated!

Craigerzz

[originalhealer]

Good luck! If you do start the new job prior to the 341, you could always amend your income schedule. I think the only time there is a charge for an amendment is if you're adding creditors.

Staci,

I would not suggest that he amend his schedules because of an increase in income. The case is based on his situation on the day that he filed.

At the 341 meeting, simply tell the Trustee that you have a new job now.

[HHM]

Staci,

I would not suggest that he amend his schedules because of an increase in income. The case is based on his situation on the day that he filed.

At the 341 meeting, simply tell the Trustee that you have a new job now.

Exactly, if you get a job AFTER YOU FILE bankruptcy, you do not need to amend your schedule's. Income earned from regular employment after the date of filing is not property of the Chapter 7 Bankruptcy Estate, so you do not need to amend.

[StaciMM]

So what happens when the trustee asks if your financial situation has improved, and you answer truthfully?

"Yes, I have $X more income each month now than I did 4 weeks ago."

[2US]

Just a suggestion, but if and only if asked to elaborate, I would simply say that while a slight increase was realized, the cost of gas, and extra wear on the car, pretty much balance out the extra income.

[craigerzz]

My Concern

My concern would be that I get a job and it obviously would increase our income by 2x from what it is right now. I presently have 2 jobs right now, but I am quitting both of those and relocating to another state. At the time I file I will be unemployed, but will most likely have a new job by the time of the 341. This is a unique situation I'm sure.

[HHM]

So what happens when the trustee asks if your financial situation has improved, and you answer truthfully?

"Yes, I have $X more income each month now than I did 4 weeks ago."

You can answer truthfully, legally, it doesn't matter. Post petition employment income in a chatper 7 is not property of the bankruptcy estate, th trustee can't touch, the US trustee cannot object.

You only make amendments to your petition for things that should have been on the petition AT THE TIME OF FILING.

The only issue with a new job or increase in income post filing is whether there was some bad faith...e.g. you accepted the job before filing but held off starting the job until after you filed bankruptcy.

[craigerzz]

Ah, now that makes sense to me and seems fair! Thanks HHM