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$70,000 medical bills, and lots of unusual questions/situations Help Please!!!

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    $70,000 medical bills, and lots of unusual questions/situations Help Please!!!

    Trying to file chapter 7, current on all bills except for medical. I have a personal injury case, which will be listed as an asset. I don't even care if I get anything out of it at this point.
    My husband inherited 1/3 of the value of our home ($50k), and we are buying out the other 2/3 from his brothers. There is no mortgage on it at all, but we do have the monthly payment.
    We have one paid for vehicle worth $3000 and another worth $12,000 which we owe $6000 on. ($9000 equity in vehicles) My husband works in another town, and I go to school full time, so we can't live with one vehicle.
    I am still trying to determine if Social Security benefits for my son will be considered income; if so I will be over median income.
    It gets even more complicated- I sold a mobile home in 2008, and will receive the last payment next month. The title will not be transferred until then. I want to file this month, will it be an asset even though was actually sold two years ago? (long before any of the medical bills occurred).
    We have no issues paying our bills, we don't even have credit cards. I plan on filing in the next few weeks- I can't take all the harassment any longer.

    *has anyone taken out a loan to pay attorney, and how will this loan be treated?
    *has anyone traded in vehicle for more expensive one to lower equity? would it be fraudulent? Would I get to keep the new vehicle?
    *we will be getting health insurance through my husbands job in January, cost is $600 a month-are future expenses ever considered? (currently uninsured)
    *I have a second savings account in my daughters name- a fundraiser for a trip she wants to go on through the school. How will this be treated?
    *income from student loans (exempt) was deposited in regular bank account. How will it be determined whether loan money or income was spent (and which was which)?
    When looking back at bank statements, the student loans make my income look way over.

    #2
    Trying to file chapter 7, current on all bills. Why?

    If you are going to file, paying on any debt that is going to be discharged in the BK is throwing money away.
    Stop all debt payments unless it is a house or car you are going try to keep through the BK

    My husband inherited 1/3 of the value of our home ($50k), and we are buying out the other 2/3 from his brothers. There is no mortgage on it at all, but we do have the monthly payment.

    No mortgage but there is a monthly payment? Who gets the payment?
    During probate did the title/deed get the names changed to your husband? husband + brothers?

    The house is a problem. His equity is 50K and NM only protects 30K, so the house may be taken by the BK trustee and sold to get the 20K in non-exempt equity. Plus the problems with three people on the title/deed

    The vehicles might be a problem for the BK, NM allows 4000 in vehicle equity each person. So with 8K to cover both cars, you need to get a lower evalution for your vehicles, use Kelley Blue Book, or go to Craigslist, find a match to your vehicle, check the price.

    No idea on how to handle the mobile home sale...need an attorney to weigh in on this one....

    has anyone taken out a loan to pay attorney, and how will this loan be treated?
    Don't do this, if you know you are going into BK, it is fraud to be using credit. Stop all payments on debt and use that money for the atty.

    has anyone traded in vehicle for more expensive one to lower equity? would it be fraudulent? Would I get to keep the new vehicle?

    Fairly common, not fraudulent if you know you can easily afford the payments post-BK. If you can keep paying, you can keep the vehicle.
    Probably not a necessary move, you can re-evalulate the cars you have and be under the exemption limits.

    cost is $600 a month-are future expenses ever considered? Yup, future expenses will go on Sched J

    I have a second savings account in my daughters name This is a cash asset that can be grabbed, spend it paying utility bills in advance. When you are not paying utility bills, put the $$ back.

    income from student loans (exempt) was deposited in regular bank account. How will it be determined whether loan money or income was spent (and which was which)? Once the exempt student loan money got put in with regular cash, it lost its exempt status and is now regular cash. You will need to get this spent before the BK Maybe pay ahead on tuition or other school expenses.

    When looking back at bank statements, the student loans make my income look way over.

    Student loans are cash assets if left hanging around, but they are not income. You are not going to use bank statements to prove your income, bank statements are for catching large chunks of cash going in and out, you will get asked about where the money went. For income verification you need pay stubs or cancelled checks from your employer. Self-employed use their tax documents or business records. Everyone hands in tax returns for the last two years.

    Wow....lots of blathering....hope some is useful..

    Tom in Colo
    Ch7 filed 5/12/2010.....341 meeting 6/30/2010....report of no distribution 8/15/2010.....discharged 10/01/2010.....closed 11/09/2010

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      #3
      Not trying to scare you but, you need to get yourself to an attorney in the worse sort of way.
      If, whoever is holding the mortgage on your house hasn't properly perfected the lein the trustee can snatch it away from both you and the mortgage holders.Since you have family involved in this, don't file until you get some answers as to how it'll affect them.

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