Back in a dilema....as far as income for a Ch7

[JEM]

Ugh. Why can't this just be easy?

My husband's income changes each week based on how many hours he works. He's guaranteed 40, but often during busy times he work OT. Not voluntary either. If you are given 5 10hr days, you work them and end up with 10 hrs OT.

So it's hard to forward look as to what his income will be.

Back in Sept. he got a $1000 referral bonus because his company was hiring and someone he referred was hired. He's been there 8 yrs and it was the ONLY time he's ever gotten the bonus. We really figured it was a one time thing. BUT it put us "right" over the median for a chapter 7.

Well, now it's fallen off and we're right under the median. HOWEVER, his company is hiring AGAIN. And he's getting one more $1000 bonus, which is GREAT because we've been freaking out about how to pay for the attorney's fees (which are going to be about $2800 for a Ch7). He could possibly get up to $3000 though because it looks as though they are hiring 5 people. Dh just knows a lot of guys looking for work (as many are these days), so I think that's why so many are jumping on the opportunity to get hired on.

BUT, this is going to put us over the median AGAIN. I don't think we can wait out another 6 months without getting sued. We stopped paying CC's in December.

My biggest fear is that if we were forced to file a CH13, that isn't a true picture of our income because $3000 over 6 months lookback makes it look like we have an extra $500 month that we won't be getting "forever". It's not re-occuring monthly income.

So what do we do?

Do we go ahead and pay the attorney, and just sit in a holding pattern HOPING to make it till that falls off the lookback without getting sued?

Will attorney wait that long to file for us after he's been paid?

It just seems that something keeps happening to make this more difficult.

[tay666]

Just because you are over the median income, doesn't mean you can't file a CH7.

If you have legitimate expenses that leave you with less than $100 a month you would still qualify for a CH7.

[keepinitreal]

Now that your September income has fallen off and you're under the median, can you file now before you get the $3000 bonus? Possibly have family help pay the attorney fee?

[JEM]

Now that your September income has fallen off and you're under the median, can you file now before you get the $3000 bonus? Possibly have family help pay the attorney fee?

Well, that's something we thought MAY work...but it would have to time perfectly. We were brainstorming today and thought that maybe if it came in May, and we filed before the end of May, it wouldn't count on the 6 month look back because we'd have income from Nov-April on the look back.

And I haven't asked a family member about borrowing, but it is something we've talked about.

[JEM]

Just because you are over the median income, doesn't mean you can't file a CH7.

If you have legitimate expenses that leave you with less than $100 a month you would still qualify for a CH7.

I've been running the numbers and I don't think we'd get the expenses to only give us $100 per month in DMI. I think the "extra" from the referral bonuses would give us to much DMI and get pushed into a 13. But then what happens when we're not getting the bonuses every month and we don't ACTUALLY have the monthly income to fund a 13?

Ugh. Why is getting extra money such a PITA.

[JEM]

I guess my main concern would be being forced into a 13, because those bonuses would make our DMI too high.

I was just reading another stickied thread in the 13 forum about them using CMI to figure out your payment--NOT just what's on the 6 mo. look back. So am I understanding that we could argue those referral bonuses aren't re-occuring and they wouldn't be used to figure disposable income?

[Overmihead]

I can't give any advice as far as a 13, but I would say if there is any way you can get the money together, file NOW, before that bonus money is counted. If you have a family member who is able to, you could have them get a money order for the attorney, and then there wouldn't be any money going directly from them to you. Then after you file, you know you will have that 3K coming in that you can give the relative when it's safe to do so. It's a hassle, but would be worth it if it means the difference between a 7 and a 13.

[music12]

i also think you should file now. it's the safest way, it seems to me. talk to an attorney asap.

[JEM]

I have a sinking feeling we're going to end up in a Ch13.

Ugh. I am so so frustrated by all of this.

Dh just found out a little while ago that he will get referral bonuses for 2 new hires. Which equals $2000. I did the math (AGAIN) and that puts us about $1300 over the 6 month median income.

We pass according to the means test though. And from my calculations, we're really close to having less than $200 DMI on Sched. J. I would assume a good attorney could overcome that. But based on our unsecured debt amount (dangerously close to $100K once all of the late charges, interest and other stuff is added in), and being over the median...I think we'd get pushed into a 13.

I am sick.sick.sick over this. For one, we don't and WON'T *really* have that kind of DMI every month because he won't continue to get those bonuses. We'll be doomed to fail from the start.

We stopped paying CC's in Dec. I don't think we'll be able to wait to file until this income falls off.

I am freaking out now. I feel more trapped than I did before we even contemplated filing.

Even IF, IF we could scrounge up the money to file in May (because dh will get those bonuses in May and May won't count yet), I don't think we can pull the whole thing off. We're still trying to catch up our mortgage before filing so that we can file a Ch7. So we have to scrape up the money to file $2800ish, and make one extra mortgage payment, $1087, before the end of May. I just don't see it happening.

I feel like the walls are caving in around us right now.

If anyone has any ideas for me right now, I'd love to hear a fresh perspective, because I feel like I've lost mine.

[newbie2]

Jem, I would ask your husbands employer to write a letter stating that they are done hiring for the year and that the bonus that he received will not be recurring. Perhaps that will help to convince the trustee that this "income" would not be recurring and that to include it would be a hardship.

[JEM]

Hmmm..I hadn't thought of asking an attorney something like that. Do you think it would hold much weight with a trustee? Given our other red flag of being close to 100K unsecured.

[newbie2]

Hmmm..I hadn't thought of asking an attorney something like that. Do you think it would hold much weight with a trustee? Given our other red flag of being close to 100K unsecured.

I have no clue as to how the trustee would view it, but it surely can't hurt. If the bonuses will certainly end then you do have a strong argument against including it in your income looking forward.

[BCA2009]

Don't worry about being over the median if you have enough expenses to cover it on the means test. I'm sure you can lower your schedule J. I don't believe it has to be negative. Just get it under $100 or so. File a Chap 7 and the worst that can happen is be dismissed and then you decide if you want to go to a Chap 13. Don't let an attorney push you out of a 7 just because you are a little over the median. Lots of people on this board have been way over the median on the means test and were successful in a 7.

Good Luck!

[music12]

from everything i've read on this board, first i feel it's likely you could pass the means test if you try hard enough. search this board for ideas about what expenses to put in your means test. often things get forgotten. if that doesn't work, find a lawyer who feels confident about explaining the bonus away. on schedule I (the one for the income) there is a question about whether your income will be changing in the near future. that's where you could say that the bonus is not a recurring income and should not be included.

and take a deep breath. the bk code isn't there to trap you. the trustees are not there to trap you. there is a very good chance you'd still be a ch7. just find a lawyer who can do that, and don't pay any lawyer that you don't feel comfortable with. also, if you say where you are then i am sure people will PM you with names of lawyers they have had good experiences with.

i do think you have to be current with your mortgage when you file, so that's kind of important as to the timing.