Having trouble keeping our heads above water.

[ForumReader]

Just read the entire thread and I agree with the last post, that, Rusty, it is best for you to go see a few BK attorneys and to see if filing for BK is the best option for you and your family. It does sound like to me, you may end up being in a CH 13 plan though. Good luck.

[rusty95]

I wanted to add one more thing about the house. Although I agree with the others that it is simply beyond your means the decision in how you want to live is yours alone.

When your children get older, they will not so much care about WHERE they lived but will cherish the memories of growing up. Many of these memories for most people include vacations and family time spending time together. As long as you live to pay for that house, these opportunities will be very limited.

So do the math and figure out if you want to be the parent that is slaving to pay for something that keeps you financially strapped, or if you want to be the parent that has time and money for that precious quality time.

Please don't take offense, but your financial condition does reflect in the type of parents you are. Stress, working overtime, constant worrying and all are a weight on our shoulders.

Think carefully and make the decision that is best for your family in the long run, not just today.

Where my daughter lives now is the best thing in the world for her. She is having great memories because of where we live. And as for vacations we always try to find the money to take one, once a year. Last year we went to California for 10 days. Vacations and memories are not the problem.

As for overtime, I don't work any because there isn't any to be had in my company. And my wife works a 40 hour week.

Believe me guys as much as you jump on my house it is not the problem. I have been paying a mortgage that is 29% of mine an my wifes salary for a long time now. The house will not go because then we have nothing.

[rusty95]

I appreciate all of your comments. But I will not stop paying the cards until I see a lawyer. And I will only do so upon him telling me. He will be able which avenue too take. I will not go chapter 13. If that is my only option we will tough it out and pay them down.

[BrokeOR]

Rusty,

One last stab at some help from the Forum...A link that tells you what the IRS numbers will be like, when assessing acceptable expenses for a Chapter 7.

http://www.irs.gov/businesses/small/article/0,,id=104830,00.html

You will note that in Suffolk county, the allowable expense deduction in Chapter 7 cases is $2,647 a month, including utilities (and that's for a family of five-it goes down slightly for smaller families). You are way over that, and a Trustee could question this in a 7, in that you pay much more than that.

Another link that may be helpful to you is this one, that deals with income limits for Chapter 7. For a family of four the limit in New York is $82,457. If you are a smaller family, it goes down.

http://www.totalbankruptcy.com/chapter-7/requirements/median-income-tables.aspx

Nobody is arguing that these limits are based on any of our realities...Just that they "are".

[rusty95]

Rusty,

One last stab at some help from the Forum...A link that tells you what the IRS numbers will be like, when assessing acceptable expenses for a Chapter 7.

http://www.irs.gov/businesses/small/article/0,,id=104830,00.html

You will note that in Suffolk county, the allowable expense deduction in Chapter 7 cases is $2,647 a month, including utilities (and that's for a family of five-it goes down slightly for smaller families). You are way over that, and a Trustee could question this in a 7, in that you pay much more than that.

Another link that may be helpful to you is this one, that deals with income limits for Chapter 7. For a family of four the limit in New York is $82,457. If you are a smaller family, it goes down.

http://www.totalbankruptcy.com/chapter-7/requirements/median-income-tables.aspx

Nobody is arguing that these limits are based on any of our realities...Just that they "are".

I honestly don't know where the IRS gets those numbers from but there is no way anyone out here with a mortgage can live at that level. Maybe a third world country but not in the tri state area. My electric bill alone is 285. And that is running around shutting things off.
I have proof for every expense that I have. NY has the highest rates in the country.It is all legitimate.

[Klesko]

Where my daughter lives now is the best thing in the world for her. She is having great memories because of where we live. And as for vacations we always try to find the money to take one, once a year. Last year we went to California for 10 days. Vacations and memories are not the problem.

As for overtime, I don't work any because there isn't any to be had in my company. And my wife works a 40 hour week.

Believe me guys as much as you jump on my house it is not the problem. I have been paying a mortgage that is 29% of mine an my wifes salary for a long time now. The house will not go because then we have nothing.

I hate to tell you this but you have nothing now, financially speaking. So why not sacrifice 3-4 years so you have something in the future? Or you can continue to struggle and maybe in 10-15 years you get out of it. But more then likely you delay the inevitable. The first bump in the road say 2-3 years from now and you are forced in BK7 losing the house and having to fix something that could have been fixed years ago without the BK.

[flyinbroke]

No one has said the IRS is realistic with its numbers; if I am not mistaken, they base them off census reports and the last one is ten years old! I think they also use inflation rates, which have gone down...making amounts lower.

To the OP, best of luck whichever road you choose.

[BrokeOR]

Rusty, you say:

"And as for vacations we always try to find the money to take one, once a year. Last year we went to California for 10 days. Vacations and memories are not the problem."

Combined with all the other info you have shared, then, it all seems to add up to your not being a candidate for Chapter 7. But I am curious, not a lawyer or anything close, and would love to hear what you finally find out.

[LSUTiger32]

Rusty man, do all of us a favor and get to an attorney. Maybe hearing it from him will make you understand. No one here is trying to take your house from you, but we all have been through this process and whether you want to hear what is going to happen or not, you asked.

So far nothing makes sense here.

1. You make $181K but only bring home $105K? That is 42% of your income not coming home and you already mentioned how high your exemptions are. You cannot put $800 a month into a 401K while paying off 401K loans. That makes no sense. You seriously need to consider lowering or temporarily suspending 401K contributions. You have a mess on your hands and need the cash.

2. I totally understand about not wanting to give up your house....and if you are determined to keep it you MUST lower your lifestyle and expenses down to NOTHING. You will have to sacrifice something because right now you will lose the house one way or another. That means brining lunch to work, no eating out, no car payments, and maybe even giving up things like cable TV to make your budget work. I don't care if it is 2% of your gross income, you don't get to spend your gross income. You are at well over 50% of your NET income and you will never get ahead like this. Right now I am at 35% of my NET and it's still a struggle for me at times even with no credit card bills.

3. Vacations? Seriously? Dude, you need a reality check, big time.

4. $4,920 ($4,365 plus $555) divided by $15,083 ($181,000/12) is nearly 33% of your gross. (4920/15083=.326) However when your are only taking home 58% of your gross, it makes those numbers pure insanity. This is not even taking into account that you mentioned the taxes were about to go up.

5. $208 a month for life insurance? Please tell me you don't have trash whole life policies? The last thing in the world you should do is use a life insurance policy as an investment tool. If you are doing it with your financial situation then we found something worse.

Keep doing it "your way" and you will lose the house whether it is through BK or foreclosure. You cannot keep doing things "your way". The quicker you learn that the more of a chance you might have to turn this around. If you are dead set on filing and dead set on keeping the house then go ahead. Nothing we are going to say is going to change your mind. I just don't see how a CH13 payment plan in addition to your mortgage payment that will be well over $5,000 (with increase in taxes) on a $8,500 income (after you change exemptions) is going to help you. To each his own though.

You make 6 figures a year, not a month.

[OhioFiler]

I honestly don't know where the IRS gets those numbers from but there is no way anyone out here with a mortgage can live at that level. Maybe a third world country but not in the tri state area. My electric bill alone is 285. And that is running around shutting things off.
I have proof for every expense that I have. NY has the highest rates in the country.It is all legitimate.

You've pegged your problem for me. You think living in one of the most overly taxed, ridiculously priced markets in the country is the place to raise your kid and the rest of us live in some third world location. Your insult makes me laugh.

We own a 1,900 square foot home on one acre of property in one of the highest rated school districts in our state. My mortgage payment and HELOC combined total less than $1,200 per month INCLUDING property taxes and insurance. I have no monthly train fees or likewise progressive hip expenses.

Our kids have a great home, great neighborhood friends and great memories yet we've never summered in the Hamptons or done 10 days in California. Mostly, we just hang out here in our third world foraging for scraps and searching for palm fronds to repair the hutch roof.

For what it's worth, I'll take my third world over your world any day.

[rusty95]

I hate to tell you this but you have nothing now, financially speaking. So why not sacrifice 3-4 years so you have something in the future? Or you can continue to struggle and maybe in 10-15 years you get out of it. But more then likely you delay the inevitable. The first bump in the road say 2-3 years from now and you are forced in BK7 losing the house and having to fix something that could have been fixed years ago without the BK.

I hate to tell you this but before I got into this mess with charge cards we had no financial problems we had more than enough money to live and save. So if you take out the equation of the cards it will be back to normal.

As I said before the house is not the problem we can handle the payments on the house. If it was a problem I would have stopped paying the mortgage a long time ago. Lets see 4400 x 12 = 50400 that pretty much solves the CC problem.

[OhioFiler]

I hate to tell you this but before I got into this mess with charge cards we had no financial problems we had more than enough money to live and save. So if you take out the equation of the cards it will be back to normal.

As I said before the house is not the problem we can handle the payments on the house. If it was a problem I would have stopped paying the mortgage a long time ago. Lets see 4400 x 12 = 50400 that pretty much solves the CC problem.

Maybe next vacation you take the family for a raft ride down Da' Nile.

[rusty95]

Rusty man, do all of us a favor and get to an attorney. Maybe hearing it from him will make you understand. No one here is trying to take your house from you, but we all have been through this process and whether you want to hear what is going to happen or not, you asked.

So far nothing makes sense here.

1. You make $181K but only bring home $105K? That is 42% of your income not coming home and you already mentioned how high your exemptions are. You cannot put $800 a month into a 401K while paying off 401K loans. That makes no sense. You seriously need to consider lowering or temporarily suspending 401K contributions. You have a mess on your hands and need the cash.

2. I totally understand about not wanting to give up your house....and if you are determined to keep it you MUST lower your lifestyle and expenses down to NOTHING. You will have to sacrifice something because right now you will lose the house one way or another. That means brining lunch to work, no eating out, no car payments, and maybe even giving up things like cable TV to make your budget work. I don't care if it is 2% of your gross income, you don't get to spend your gross income. You are at well over 50% of your NET income and you will never get ahead like this. Right now I am at 35% of my NET and it's still a struggle for me at times even with no credit card bills.

3. Vacations? Seriously? Dude, you need a reality check, big time.

4. $4,920 ($4,365 plus $555) divided by $15,083 ($181,000/12) is nearly 33% of your gross. (4920/15083=.326) However when your are only taking home 58% of your gross, it makes those numbers pure insanity. This is not even taking into account that you mentioned the taxes were about to go up.

5. $208 a month for life insurance? Please tell me you don't have trash whole life policies? The last thing in the world you should do is use a life insurance policy as an investment tool. If you are doing it with your financial situation then we found something worse.

Keep doing it "your way" and you will lose the house whether it is through BK or foreclosure. You cannot keep doing things "your way". The quicker you learn that the more of a chance you might have to turn this around. If you are dead set on filing and dead set on keeping the house then go ahead. Nothing we are going to say is going to change your mind. I just don't see how a CH13 payment plan in addition to your mortgage payment that will be well over $5,000 (with increase in taxes) on a $8,500 income (after you change exemptions) is going to help you. To each his own though.

You make 6 figures a year, not a month.

#1- Taxes, 401k, 401k loans, medical ins, life ins, plus all the other misc deductions. I average 800 to 1000 a week in deductions. My wife fills in the rest.

#2 The house stays, The house stays the mortgage no matter what you think is not the problem, The cards are. If you have lung cancer are you going to cut your leg off.

#3 Vacations..yes. We scrounge the money up for them. Like I said before, you ask a question and I will answer it to the best I can. You may not like the answer.

#4 I don't think it is insane, we had plenty of cash before we got into trouble with the cards.

#5 Yes 208 for insurance. Term insurance. 500,000 each. i got it when I was 45, thats why it is more. 500,000 to cover the mortgage. We don't want the other to be homeless if one dies. One less worry.

How can I lose my house. I pay the mortgage before everything else.

[rusty95]

You've pegged your problem for me. You think living in one of the most overly taxed, ridiculously priced markets in the country is the place to raise your kid and the rest of us live in some third world location. Your insult makes me laugh.

We own a 1,900 square foot home on one acre of property in one of the highest rated school districts in our state. My mortgage payment and HELOC combined total less than $1,200 per month INCLUDING property taxes and insurance. I have no monthly train fees or likewise progressive hip expenses.

Our kids have a great home, great neighborhood friends and great memories yet we've never summered in the Hamptons or done 10 days in California. Mostly, we just hang out here in our third world foraging for scraps and searching for palm fronds to repair the hutch roof.

For what it's worth, I'll take my third world over your world any day.

Ya thats the thing I want to do, leave great jobs and a great area and move to a state I don't have a job in or family or friends. That would really solve the problem.

No insult meant and if you took it that way I apologize.


I am happy for you that you have provided you and your children a great place to live.

Maybe you should take a vacation. It's nice to get away from the day to day problems.

[rusty95]

Maybe next vacation you take the family for a raft ride down Da' Nile.

Yes this year I think we are going to vacation ion the Swiss Alps.

There is no reason to be a wise azz here.