CONFUSED: need expert advice: Planning ahead for Ch 7,no asset case!?

[Confuzed]

I want to thank you in advance for your time as I don't know what to do...

My situation: No legal title to assets (no car, house, property), no transfer, they can look back 10 years, I dont have anything of value. zip. zilch. I had a previous chapter 7 before the new law a long time ago and this will be my second (please don't flame me for this, I learned my lesson, finally!)

I have access to family members car and I maintain it and put gas in it and pay the insurance.
I pay family member for living quarters in cash for 1 side of the house as a verbal contract on a monthly basis.

All I get is a paycheck and I am around the median income for my state.

Now as I plan to file for later this year, and all my debts are a bunch of credit cards for around 30k. Since I was choked off with a gap in employment last year, I defaulted, and all debts are charged off by now. Now I have gotten ahead and it makes no sense to try to pay 30k in debt from my small paycheck, but I am having money left over.

I just withdraw cash all the time and pay for everything this way, easier to keep track of and my family member doesn't take visa check card , lol, and I dont order checks. My job only pays direct deposit, that is why I have a checking account.

What is the best way to handle this until I file in 6 months, do I just keep withdrawing on a cash basis? Do I buy gas on the check card (even though I dont own a vehicle, this may look fishy?), + groceries? Do I let it accumulate as cash in the bank? Can I travel? Can I buy small items online (books, music, clothing, airline ticket). I just feel like I am forced to use every penny of it and show that it was for living expenses, the extra money left over doesnt even put a dent in my debts. Any advice on how far I can go?

I plan to file as a no asset case under the median so no part 2 of the means test. How would you handle this situation? How do I spend my money since I cant save it??? Like a catch 22 situation here? So confused on how to have a smooth filing down the road. THANKS A MILLION!!!

[keepmine]

Have you filled out schedules I and J to determine dispsoable income?
Just ecause you pass the means test does not automatically qualify you for a Chapter 7 if you have sufficent DI to fund a Chapter 13.

[TEW]

You have expenses it sounds like you need to get them documented. If you don't like keepmine said you'll have to file chapter 13

[Confuzed]

I dont get it, I am a lousy candidate for a chapter 13, which is a repayment plan..I would default on the chapter 13 agreement because I would be broke again, back to square one, I would take forever to pay 30k in debt on my salary of 40k/year before taxes. What assets would I be saving anyways? I own nothing. I am even more confused now...isn't Chapter 13 better for people who dont want to lose a property??? Chapter 13 offers me no benefit. I was just wondering what to do in my situation so that I can prepare to get the Chapter 7, thanks in advance if you have any other ideas, I would really appreciate it!

[optimistic1]

In terms of your expenses, I dont think you need to worry about them, as long as what you would be declaring as your expenses does not exceed the IRS standards, or the Chapter 7 trustee expense guidelines.

You are overthinking the entire process.

Now, keepmine is correct. Just because you pass the means test, and are under median income, does not automatically qualify you for a CH.7. Some districts, (judges,trustees) will rule under the totality of circumstances.

Meaning, if your expenses, subtracted from your income, show that you have more than say $130 every month. They might want to push you into a Ch.13. And if you are under a Ch.13, it would be at a minimum of 3 years, for $130 a month, give or take.

So, when you sit down and calculate your expenses, and deduct them from your income, make sure you break even, or have barely anything left, like $50.

Better yet, make sure you hire a certified bankruptcy attorney, who is familiar with the local court rules and judges and trustees, so that way, you dont end up in a pickle.

[keepmine]

Here's a site that will allow you to run your schedules and see where you are with regards to DI.

http://www.legalconsumer.com/bankruptcy/means-test/index.php

[Confuzed]

It is hard to repay 9 charged off accounts with crazy fees and interest and penalties already tacked on by the original creditors plus whatever insane stuff is piling on using 1 monthly payment and my salary is chump change with the cost of living. Something always comes up in life, whether its medicine, a visit to the dentist which is expensive, or a vehicle breaking down (which isnt even mine but I am responsible for it), clothing, food, gas. The left over money wouldn't even make a dent vs. 9 different debts. You are right, my problem is documentation, it still seems weird to have a family member write out a rental agreement and present it legit (although it would be the truth.) Oh well, I guess I will take the risky road and file. It's my fault and I will have to face the consequences. An attorney can guide me, I just wanted to be prepared in advance of seeing an attorney to speed up the process. I am not trying to avoid the debt, but when you default, you get into a deeper hole with a domino effect and forced into a chapter 7 unfortunately. The stress isn't worth talking to 9 different bozo collection agencies that are rude, lie, cheat, and will take your payment and then say you didnt satisfy the debt through trickery.

Thanks for the input!!

[BnkrptcyLwyr]

It is hard to repay 9 charged off accounts with crazy fees and interest and penalties already tacked on by the original creditors plus whatever insane stuff is piling on using 1 monthly payment and my salary is chump change with the cost of living. Something always comes up in life, whether its medicine, a visit to the dentist which is expensive, or a vehicle breaking down (which isnt even mine but I am responsible for it), clothing, food, gas. The left over money wouldn't even make a dent vs. 9 different debts. You are right, my problem is documentation, it still seems weird to have a family member write out a rental agreement and present it legit (although it would be the truth.) Oh well, I guess I will take the risky road and file. It's my fault and I will have to face the consequences. An attorney can guide me, I just wanted to be prepared in advance of seeing an attorney to speed up the process. I am not trying to avoid the debt, but when you default, you get into a deeper hole with a domino effect and forced into a chapter 7 unfortunately. The stress isn't worth talking to 9 different bozo collection agencies that are rude, lie, cheat, and will take your payment and then say you didnt satisfy the debt through trickery.

Thanks for the input!!

You're not understanding a Ch13. You won't be paying interest on the credit card debts, and you pay whatever your disposable income says you pay. If you pay 20% to unsecured creditors, so be it, if you pay 2%, so be it, if you pay 100% so be it.

But with little to no real expenses ... you might qualify under the means test ... but might nonetheless be a Ch13 candidate based on the other test (the "totality of the circumstances" test.)

Please see a (good) attorney.

It may be that you can qualify for a 7 (who knows, we don't enough info) ... but the way it sounds, I can see a 13 too.