Very Weird Attorneys - Help!

[sjcmCA]

Finally, I met two attoneys today for the free BK consultation.
However, I am very confused with the attorney's advises.

(( Attorney 1 ))
The first attorney told me that I can include the following in the MEANS TEST.

(1) 1st mortgage, HELOC, HOA, Property Tax (This is for my rental property to surrender)
(2) My rental payment (I'm renting a house now)
(3) Student Loans
(4) All other taxes, car payments, utilities, education expenses for kids, etc.

The first attorney concluded that I am sure to be qualified for Chapter 7 even though my income is $6,000 higher than the state median income

(( Attorney 2 ))
The second attorney told me that I can include the following in the MEANS TEST.
(1) My rental payment
(2) All other taxes, car payments, utilities, education expenses for kids, etc.

I ended up with Chapter 13 with $1,700 disposable income per month.
The second attorney said that I can't claim the mortgage related expenses since I will surrender the rental property in the future.

Both attorneys in the same town (1-mile away), how can they come up with very different conclusions?

The first one just play a game to hook me up and say "Sorry, you are not qualified for Chapter 7 unfortunately" later?

I am very confused and disappointed today.

Any advise or similar experience?

[2manybills]

Where are you located? If you are over median, I would go with an attorney that is referred to you by someone on this board.

You will want an experienced and good attorney with student loans in the mix also.

[sjcmCA]

Thanks a lot for the quick response.

I am living in Northern California.

It souds like it depends on the experienced attorney? Is it possible that the first attorney just say "I am sorry. I thought you are qualified for Chapter 7 but you are not" later?

[2manybills]

I'm not sure about that. Some guys just push the envelope more. I would maybe do a post for Northern Cal. folks on here in your area to get someone to PM a recommendation for an attorney.

[backtoschool]

Whether or not student loans are allowed as expenses varies by district. There have been a few cases on this board where the trustee disallowed the student loan payments and that pushed the filer into a chap 13.

Also most trustees will not allow you to claim expenses on a property you are giving up.

I agree with the other posters who said to find someone on this board who is from your district to try to find out if the student loan expenses will be allowed.

[Amy26]

Yea, I'm not in CA but I was not allowed to claim expenses for a property I was not keeping. Specially since I stopped paying on it! My lawyer advised me to go out and get an expensive rental (not like crazy mansion expensive but like not as cheap as I could find in a bad part of town).

[MSbklawyer]

Also most trustee will not allow you to claim expenses on a property you are giving up.

That's another gray area. The First Circuit Court of Appeals just decided a case that says the debtor DOES get to count expenses on secured debt ---even if they are giving it up.

So don't be too hard on the lawyers. The law governing the means test is still relatively untested.

Personally, all things being equal, I'd go with (( Attorney 1 )). If he's wrong and you don't get to count some of the things he tries for . . . you'll know better next time. But if he's right, you may avoid chapter 13.

[liz417]

I consulted with 6 different attorneys and got different answers from them all! I started to doubt myself, but ultimately, I choose an attorney that was confident about my case (over the median, lots of BT/cash advances) and had YEARS of experience in BKs only. Some of the attorneys told me that I wasn't able to include my Student Loans in my expenses, but my attorney said "sure, why not?" I actually liked another attorney too, but went with my now attorney because he was VERY familiar with the local Trustees and what they would allow and wouldn't allow in my schedules. At my 341 a hand full of people went before me and you could see their attorneys fumbling around but when my attorney approached the Trustee, they were all joking and laughing with each other....that put my mind at ease

I would advise you to set up a few more consults. Good Luck!

[justplaintired]

I agree if you not sure which ones correct, consult another. Consults are free and it seems that you are getting different opinions so why not see what a third says.

Now we were told we couldn't use expenses we weren't keeping and since you are not even living in that home, I doubt seriously you can claim that one. Just because you are over on median doesn't mean an automatic 13, find out more info on what is considered an allowable exemption in your state.

Just keep looking around here too, lots of info on allowed exemptions and definitely meet with a few more attorneys. No harm in that and who knows the next one just might be the perfect fit for you.

Good luck

[sjcmCA]

Thanks for all your input and suggestions. I really appreciated.

Yes, I will schedule more consultations with other attorneys and update the results.

[Chowder]

Very Weird Attorneys - Help!

I'd take weird and aquatinted with the Trustees habits over conventional and uninformed any day.

[sjcmCA]

I came up with a question from others threads.

Bankruptcy is a federal law. But how can the local Trustees apply different judgements to each BK case? Some are saying that mortgages and/or students loans won't be counted as the expenses but others experienced that they could include those in their expenses. (I checked a lot of similar threads in this forum)

Mortgages and student loans are critical factors to judge Ch 7 or 13. But how can the federal BK law have so different results? I think it's not fair. I am just curious....

[leena]

I think the student loans issue gets really complicated. Here in Hennepin County, MN I am being told they are very student loan friendly, trustees rarely question because you are one way or another stuck with the debt. However, I was also told that if you are significantly above the median, that can change and also if your payment or student loan balance is "small" (meaning I guess in SL terms under 20 grand!) they can also start pushing for 13. I am "lucky" in that none of that applies to me so thus far it seems I will have no trouble with the student loans.

I think we non- pro se filers really need to be careful in what attorney we choose. My attorney is very well known and experienced, but will not even deal with most over-median cases as 7's unless there are some very exceptional circumstances (I think that means very easy to prove up on-less work for them!).

I agree with those who have said get an attorney who is really experienced and find out how student loans are being dealt with in your area. There are a lot of bankruptcy mill types out there who I swear do not really know-or much care as long as they are getting their fee (which is more I might add in a 13, at least where I live!).

[leena]

Bankruptcy Law

I came up with a question from others threads.

Bankruptcy is a federal law. But how can the local Trustees apply different judgements to each BK case? Some are saying that mortgages and/or students loans won't be counted as the expenses but others experienced that they could include those in their expenses. (I checked a lot of similar threads in this forum)

Mortgages and student loans are critical factors to judge Ch 7 or 13. But how can the federal BK law have so different results? I think it's not fair. I am just curious....

I have often wondered this myself. My job is heavily involved with another part of civil law, and there is no where near this sort of leeway given. I think what sucks is that trustees really can do whatever they like in regards to this stuff, particularly the student loans. The government mandates payment of the student loans in basically 99% of circumstances with one hand and then allows trustees to disregard them with the other. Major fault in bankruptcy reform law if you ask me.

I think it is really amazing that one person could be pushed into a 13 because student loans were disregarded, but another person could get a 7 because they got to claim a house they intend to surrender. I hope a serious look is taken at these laws soon, because they do not seem just.

[OhioFiler]

I'd keep the mortgage current on the rental property and claim intention to reaffirm. I'd dump the place after discharge. No whim of the TT in that situation.