Filing next week... what do you think?

[dscurlock]

We are going to see an attorney next friday (payday) to start the paperwork on filing BK.. I do not think there will be a problem. we will be filing jointly...we have a new house, new car, she has couple new credit cards that will not be included, so she will already have a fresh start on establishing credit before I do...she makes $63k a year, plus bonuses, my debt is 100k (no job) her debt is around 25k.. I kept update on my credit for 20 years until i lost my job and we moved, and am very credit savvy, I will enjoy that hooters card when i finally get it I also have a 1995 ford contour myself, so i do not know if they will try and take it, also still have quite a bit of furniture, lamps, table, entertainment system, big screen that we got using my credit, so i do not know if they will take that, filing chap 7.

It will cost $75 to do the paper work and 30 min consultation
before the filing begins, we have to pay $650 upfront.
then somewhere down the line, we have to pay the
balance of around $1350 to complete.

and just because my wife makes that much money does
not mean we have it, we are dead negative broke just
about every payday, at times we run out of money 2-3
weeks before payday, leaving us on negative drafts.

What do you experts thing?

[kcj]

I don't think you can exclude credit cards unless they have a zero balance and you don't list them. I had one account survive that way. Even then, the creditors can choose to close the accounts.
If you reaffirm, as we did for one CC that was joint with a relative, they still closed the account to further charges. Definitely something to look into as far as reestablishing credit.

[SinkingFast]

What State do you live in?? $63K is a lot for 2 people, providing you don't have children. I don't know of a State that has a Median income that high for just 2 people. Unless you have a lot of Secured or Priority (Income or Property Tax Debt) to offset the income.

Also, when figuring your expenses each month, you need to leave out everything you intend to discharge. All CC payments and such that you won't have after BK, in figuring your disposable income.

[dscurlock]

filing next week...

What State do you live in?? $63K is a lot for 2 people, providing you don't have children. I don't know of a State that has a Median income that high for just 2 people. Unless you have a lot of Secured or Priority (Income or Property Tax Debt) to offset the income.

Also, when figuring your expenses each month, you need to leave out everything you intend to discharge. All CC payments and such that you won't have after BK, in figuring your disposable income.

live in texas, it is not as much as you may think...we are always have to overdraft around $500 a payday sometimes, and that is 2 weeks before payday...we do not spend recklessly either, other then our actuall $125k debt, monthly living expenses takes all of her check and then some...
new home, new car, life insu, car insur, food, home insur, water, and
trust me the list goes on and on...dont sit there and think she brings in 63k and doesnt have one bill to pay, it would be nice, but that will never happen, and the home taxes at the end of the year is like $6,000, and when her pay is taxed, she brings home something like 40k year...remind you now, I have not worked in a while, so her pay really isnt that much for two, and all expensives...and i did not even list the actuall debt, plus the new credit cards she has...

I did talk to the assistant to the attorney today, and she did say we did make good amount of money, but there are 3 tests that you take, all you have to do is pass just one test, and we would be eligible for chap 7
she told us, we already failed the first test with the amount of money
she is making...but she did not say it was impossible either, she did not
ask about our expenses either...

Hey, I have watched the oprah show, you can make $100k a year,
and still have nothing to show for...

[lrprn]

live in texas, it is not as much as you may think...we are always have to overdraft around $500 a payday sometimes, and that is 2 weeks before payday...we do not spend recklessly either, other then our actuall $125k debt, monthly living expenses takes all of her check and then some...
new home, new car, life insu, car insur, food, home insur, water, and
trust me the list goes on and on...dont sit there and think she brings in 63k and doesnt have one bill to pay, it would be nice, but that will never happen, and the home taxes at the end of the year is like $6,000, and when her pay is taxed, she brings home something like 40k year...remind you now, I have not worked in a while, so her pay really isnt that much for two, and all expensives...and i did not even list the actuall debt, plus the new credit cards she has...

I did talk to the assistant to the attorney today, and she did say we did make good amount of money, but there are 3 tests that you take, all you have to do is pass just one test, and we would be eligible for chap 7
she told us, we already failed the first test with the amount of money
she is making...but she did not say it was impossible either, she did not
ask about our expenses either...

Hey, I have watched the oprah show, you can make $100k a year,
and still have nothing to show for...

The first test you two failed was the first part of the means test which means you now have to head into the dark and murky remaining pages to see if you qualify for Ch 7 or 13. Personally I can tell you that our combined income was well over the average income for our state and every single month we were $2300 in arrears making just minimum payments to our secureds and unsecureds. We don't live extragravantly either - our cars are 4-6 years old and we have two mortgages that equal just about what our home is worth in today's market. When the dust settled on the second part of the means test, we still showed a little over $400 a month in disposable income....welcome to Ch 13! Hopefully your figures will work out better than ours did.

[dscurlock]

filing next week...

The first test you two failed was the first part of the means test which means you now have to head into the dark and murky remaining pages to see if you qualify for Ch 7 or 13. Personally I can tell you that our combined income was well over the average income for our state and every single month we were $2300 in arrears making just minimum payments to our secureds and unsecureds. We don't live extragravantly either - our cars are 4-6 years old and we have two mortgages that equal just about what our home is worth in today's market. When the dust settled on the second part of the means test, we still showed a little over $400 a month in disposable income....welcome to Ch 13! Hopefully your figures will work out better than ours did.

I will never file chap 13, it just doesnt make sense, we are in the hole every payday, filing chap 13, so they can give us $500-$1000/mo payments just doesnt make sense, we are negative every payday....if i have to create more bills to dispose of more income that we dont have, then I will.

[dscurlock]

payment plan

The first test you two failed was the first part of the means test which means you now have to head into the dark and murky remaining pages to see if you qualify for Ch 7 or 13. Personally I can tell you that our combined income was well over the average income for our state and every single month we were $2300 in arrears making just minimum payments to our secureds and unsecureds. We don't live extragravantly either - our cars are 4-6 years old and we have two mortgages that equal just about what our home is worth in today's market. When the dust settled on the second part of the means test, we still showed a little over $400 a month in disposable income....welcome to Ch 13! Hopefully your figures will work out better than ours did.

$400 is not much to dispose of... if they set you up on a payment plan, then
it will take your $400 if not more, now you have no disposable income...do
they not consider that? but now that you filed, how much will your payments be if you do not mind me asking...

[lrprn]

$400 is not much to dispose of... if they set you up on a payment plan, then
it will take your $400 if not more, now you have no disposable income...do
they not consider that? but now that you filed, how much will your payments be if you do not mind me asking...

The figures that come out of the second and third parts of the means test are not directly related to the debtor's actual income vs. expenses. These figures are 'tweaked' because we now have to use the IRS figures for housing, some utilities, and transportation. That's why millions of people rushed to file bk before last October 15 - up until then you could use your real figures. Welcome to the reality of Congress's payback for years of credit card and mortgage company contributions to their campaigns.

Currently we are paying $950/month to our trustee, and remember, he filed two objections against our case so he is trying to get us to pay even more. I fully expect that to get confirmed, we will have to pay more. Why do you think filing bk is a last resort? It isn't a voluntary debt management plan where you don't have to really alter your lifestyle. You HAVE to change the way you live and figure out how to live without every single non-essential expense or you won't make it. And now you understand why only about 30% of Ch 13ers do make it through successfully - there is NO cushion at all. None.

[djk]

as someone else already mentioned, if you file jointly you need to list all creditors. my understanding is that includes credit cards even if they currently have no balance.

[dscurlock]

filing next week...

The figures that come out of the second and third parts of the means test are not directly related to the debtor's actual income vs. expenses. These figures are 'tweaked' because we now have to use the IRS figures for housing, some utilities, and transportation. That's why millions of people rushed to file bk before last October 15 - up until then you could use your real figures. Welcome to the reality of Congress's payback for years of credit card and mortgage company contributions to their campaigns.

Currently we are paying $950/month to our trustee, and remember, he filed two objections against our case so he is trying to get us to pay even more. I fully expect that to get confirmed, we will have to pay more. Why do you think filing bk is a last resort? It isn't a voluntary debt management plan where you don't have to really alter your lifestyle. You HAVE to change the way you live and figure out how to live without every single non-essential expense or you won't make it. And now you understand why only about 30% of Ch 13ers do make it through successfully - there is NO cushion at all. None.

oh we would never, ever be able to afford that, I dont care if you did strip us to the bare non-essentials...that would be almost quater of her income., why would the govt force you into a chapter 13 knowing you may not even make it....? I just totalled the essentials for sure $3,000/mo thats for House, Car, Student Loans, Cell, TV/Phone, Water, Car Insur, Life Insur, Home Insur, Gas, Food...she brings in $3700 that would be conidered $700 disposible income, this does not include smokes, nights on the town, eat outs, clothes or any of that stuff, (that would be another $500) and our debts run over 100k...and how would this work out? from what I am seeing, even 17cents on the dollar from one person, this would be $1700 a month...this would be impossible to pay...if they put us on chap 13, then this system is designed to fail, no wonder why so many do fail on chap 13 when they should have been on chap 7...they probably could not afford the payements from the get-go...

I may have not added that last part up correctly, I do not know the around about % on a $125k debt, maybe someone else has a chap 13 for around that much....

[Jman30]

You said: "I just totalled the essentials for sure $3,000/mo thats for House, Car, Student Loans, Cell, TV/Phone, Water, Car Insur, Life Insur, Home Insur, Gas, Food...she brings in $3700 that would be conidered $700 disposible income, this does not include smokes, nights on the town, eat outs, clothes or any of that stuff, (that would be another $500) and our debts run over 100k...and how would this work out?"

Again, I am not trying to be a hard ass, I am just trying to get this point across. You have to forget about things like smokes, nights on the town, eating out and any extra clothes above what the median test gives you. Smokes, nights on the town, eating out and extra clothes are considered DISPOSABLE INCOME by the very definition of the Bankruptcy.

So that $500 that you are talking about will be considered part of your disposable income for chapter 13 repayment purposes.

The Trustee can't reduce you to a cardboard box and poverty...if you owe more than your assets are worth, they will find a % that works for you. If you have more assets than debts, then you are not technically bankrupt.

But you have to forget about the idea about $175/per month of smokes and nights out and eating out. In a BK, those things are gone, or at least secondary to everything else.

My wife and I LOVE the Outback Steakhouse...which is not a super high end restaurant, but it is not like a cheap McDonalds. In 20 month of our Chapter 13, we have gone their 3 times, instead of the usual 3 times a month before a BK. You will have make major sacrifices.

[SinkingFast]

You said: "I just totalled the essentials for sure $3,000/mo thats for House, Car, Student Loans, Cell, TV/Phone, Water, Car Insur, Life Insur, Home Insur, Gas, Food...she brings in $3700 that would be conidered $700 disposible income, this does not include smokes, nights on the town, eat outs, clothes or any of that stuff, (that would be another $500) and our debts run over 100k...and how would this work out?"

Again, I am not trying to be a hard ass, I am just trying to get this point across. You have to forget about things like smokes, nights on the town, eating out and any extra clothes above what the median test gives you. Smokes, nights on the town, eating out and extra clothes are considered DISPOSABLE INCOME by the very definition of the Bankruptcy.

So that $500 that you are talking about will be considered part of your disposable income for chapter 13 repayment purposes.

The Trustee can't reduce you to a cardboard box and poverty...if you owe more than your assets are worth, they will find a % that works for you. If you have more assets than debts, then you are not technically bankrupt.

But you have to forget about the idea about $175/per month of smokes and nights out and eating out. In a BK, those things are gone, or at least secondary to everything else.

My wife and I LOVE the Outback Steakhouse...which is not a super high end restaurant, but it is not like a cheap McDonalds. In 20 month of our Chapter 13, we have gone their 3 times, instead of the usual 3 times a month before a BK. You will have make major sacrifices.

Ditto's to what JMan said. We aren't trying to be hard on you. Just give you a reality check.

Here's a link for you:

http://www.usdoj.gov/ust/

The Median Income for a family of 2 in Texas is $48,029/yr. $63K is a tad over that. That's why you failed the first part.

You'll also find the Schedules allowables for clothes, food, cleaning supplies, personal care, and such there as well.

On the Means Test, you'll get the excess for your Secured Debts if you pay more for your house payments and car payments than the Schedules allowables.

Generally speaking, many Courts will allow $100/mo for entertainment. Eating dinner out is often considered entertainment. We're not talking lunches out while you're working. But, when you and the wife go out for the evening and eat dinner, that's considered entertainment.

You might get smokes. Depends on the Trustee and the Court. What they typically allow where you file and what they don't. Some Courts allow that expense, some don't.

If you have the Gold Deluxe package for Cable or Satellite, your BK Court may only allow the expense for basic service.

If you have HUGE cell phone bills every month, your Court may only allow $50/mo for cell phone.

I've seen people post on here that their BK Court did not allow their pet expenses. Simple annual vet bill, and food, and supplies for the dog or the cat.

When you go into BK Court, you're playing the game on THEIR COURT by THEIR RULES. The Trustee's attitude is "My finances are fine. Yours are not. My lifestyle does not have to change. Yours does."

[dscurlock]

assets..

You said: "I just totalled the essentials for sure $3,000/mo thats for House, Car, Student Loans, Cell, TV/Phone, Water, Car Insur, Life Insur, Home Insur, Gas, Food...she brings in $3700 that would be conidered $700 disposible income, this does not include smokes, nights on the town, eat outs, clothes or any of that stuff, (that would be another $500) and our debts run over 100k...and how would this work out?"

Again, I am not trying to be a hard ass, I am just trying to get this point across. You have to forget about things like smokes, nights on the town, eating out and any extra clothes above what the median test gives you. Smokes, nights on the town, eating out and extra clothes are considered DISPOSABLE INCOME by the very definition of the Bankruptcy.

So that $500 that you are talking about will be considered part of your disposable income for chapter 13 repayment purposes.

The Trustee can't reduce you to a cardboard box and poverty...if you owe more than your assets are worth, they will find a % that works for you. If you have more assets than debts, then you are not technically bankrupt.

But you have to forget about the idea about $175/per month of smokes and nights out and eating out. In a BK, those things are gone, or at least secondary to everything else.

My wife and I LOVE the Outback Steakhouse...which is not a super high end restaurant, but it is not like a cheap McDonalds. In 20 month of our Chapter 13, we have gone their 3 times, instead of the usual 3 times a month before a BK. You will have make major sacrifices.

I dont have much assets, only a new home (no equity) and a new car, the past debt weighs much more, the amounts i posted above did not include any credit card payments, or any past debts....