New Here--lots of questions!!

[Tonyababyrn]

Hi!!

Having to file bankruptcy in the next few months.

Background info:

Husband--federal employee--steady income--due to retire in 10 yrs--monthly take home pay is $3000
Wife (me)--RN--but off full time work since March, worked pt time off and on till July. No work since mid July--bad back/eyes. Had a full time job for last 8yrs and when left in Jan--got retirement payment of $7000(my share after penaltys)
18 yr old daughter in college
2 other children--13 and 8


Live in Louisiana

Mortgage--originally $168,000 predatory lending at 10.75% ARM, which payment just increase from $1568 to $1951. Stupid decision, wanted a house and someone approve us!! Balance now--$167,000. Behind 5 months. Starting foreclosure--got letter from lawyer stating he was contacted by bank.

Lots of medical bills due to my health issues and several surgerys in last year.

Credit cards--$15,000

Past State Taxes--$1200

Oldest daughter in college--state pays tuition but we pay room, living expenses, gas, etc.

3 vehicles--1 financed at $490/mo, balance $16000, other 2 paid off, 1 is husbands truck to go to work, other is non working 97 honda suv.

No assets of any worth--we have tvs, dvd players, surround sound, computers (kids each have one), firearms.

Questions--

Chapter 7 or 13--we are thinking of letting the house go(very seriously thinking).

Can they force me to go to work?

How do they handle children in college, with us paying their room and board?

We don't pass the median income limits due to the retirement money I recieved in July.

With the means test--our mortgage and utilities are so much more than the amounts allowed with national standards/living expenses. What do I put in those blanks on the forms--it saids not to put less than 0.

And with with national standards, do we add in the daughter at school?

Do they take into account that our income has decreased dramatically and will be lots lower from now on.

What happens if I get a part time job later and if I do, is it better iin chapter 7 to wait until after discharged?

Sorry for all the questions?? I have been reading the posts for days and seem more confused.

Thanks so much for the assistance!!

[arkienurse]

Hi!!

Having to file bankruptcy in the next few months.

Background info:

Husband--federal employee--steady income--due to retire in 10 yrs--monthly take home pay is $3000
Wife (me)--RN--but off full time work since March, worked pt time off and on till July. No work since mid July--bad back/eyes. Had a full time job for last 8yrs and when left in Jan--got retirement payment of $7000(my share after penaltys)
18 yr old daughter in college
2 other children--13 and 8


Live in Louisiana

Mortgage--originally $168,000 predatory lending at 10.75% ARM, which payment just increase from $1568 to $1951. Stupid decision, wanted a house and someone approve us!! Balance now--$167,000. Behind 5 months. Starting foreclosure--got letter from lawyer stating he was contacted by bank.

Lots of medical bills due to my health issues and several surgerys in last year.

Credit cards--$15,000

Past State Taxes--$1200

Oldest daughter in college--state pays tuition but we pay room, living expenses, gas, etc.

3 vehicles--1 financed at $490/mo, balance $16000, other 2 paid off, 1 is husbands truck to go to work, other is non working 97 honda suv.

No assets of any worth--we have tvs, dvd players, surround sound, computers (kids each have one), firearms.

Questions--

Chapter 7 or 13--we are thinking of letting the house go(very seriously thinking).

Can they force me to go to work?

How do they handle children in college, with us paying their room and board?

We don't pass the median income limits due to the retirement money I recieved in July.

With the means test--our mortgage and utilities are so much more than the amounts allowed with national standards/living expenses. What do I put in those blanks on the forms--it saids not to put less than 0.

And with with national standards, do we add in the daughter at school?

Do they take into account that our income has decreased dramatically and will be lots lower from now on.

What happens if I get a part time job later and if I do, is it better iin chapter 7 to wait until after discharged?

Sorry for all the questions?? I have been reading the posts for days and seem more confused.

Thanks so much for the assistance!!

Welcome Tonya. I am afraid I don't know the answers to some of your questions, but wanted to make you feel welcome. I do know that no consideration was made for college expenses in our case. Hopefully your daughter will qualify for a student loan to cover room and board and other expenses, especially if you qualify for state/federal aid. We were over the limit, and he could only get student loan to suplement his scholarships.

[anonymuse]

Can they force me to go to work?
No

How do they handle children in college, with us paying their room and board?

Not sure, but from reading on the board, often paying for adult children is not considered a necessary expense

We don't pass the median income limits due to the retirement money I recieved in July.

You could wait for filing until that came out of the 6 month income calculation.

With the means test--our mortgage and utilities are so much more than the amounts allowed with national standards/living expenses. What do I put in those blanks on the forms--it saids not to put less than 0.

You use the national standards and then put in where it says to explain the differences (must have documentation to support) for your situation.

And with with national standards, do we add in the daughter at school?

Don't know

Do they take into account that our income has decreased dramatically and will be lots lower from now on.

CMI - currently monthly income is looking backwards 6 months. In Schedule I, it's projected income look forward (the law has not exactly defined this.)

What happens if I get a part time job later and if I do, is it better iin chapter 7 to wait until after discharged?

If you're in a Ch 13, you would need to report it to the trustee. If you're in a Ch 7, the safest best is not to find a new job until after the discharge. Some have suggested looking after their 341 meeting; but, personally, I'm taking my lawyer's advice and waiting until after discharge. You could be asked during your 341 if you expect any changes in income and you need to be honest.

[Tonyababyrn]

Thanks to both of you for your responses.

[SinkingFast]

About Adult Children Dependents attending college,.........

In general, BK Courts are allowing living expenses if the child lives with the Debtor/Filer while attending college. You cannot claim tuition, books, and fees, but you can claim the child's living expenses. Housing, food, clothing, etc.

If the child lives away while attending college, the BK Courts are not allowing the child in the household count. The Court's stance is the child is not with you at least 50% of the time and therefore does not figure into household expenses. Parents are not required by law to provide a post secondary education for their children so this is an expense that is not allowable in BK Court.

[Tonyababyrn]

OK--as stated in my original post--

We received a letter from a lawyer stating he was contacted by our mortgage holder to start foreclosure proceedings and

according to our past 6 month income (with my retirement cashout from previous job) we are way over the median income--this money was received in July--

Should we let them go ahead and foreclose on the house--we don't want it--and then file CH7 when the 6mo income total doesn't include in--in Feb?

Does anyone know the typical foreclosure timeline in Louisiana--how long from beginning till we would have to move??

Thanks so much for all your replies!!

[SinkingFast]

You're gonna have to ask an attny during a Consult how long Foreclosure will take. Louisiana Law is based on a European system rather than English Tort Law like most of the rest of the US. I looked at several different websites and got several different answers.

The process is Judicial, but most likely your mortgage includes an "authentic act that imparts a confession of judgment". Basically this means you know if you default the Lender can Foreclose. It makes the Foreclosure process very easy for Lenders in your State.

Various websites I looked at said the process can run anywhere from 60 days to 6-9 months. One website said 3-5 months on average. There is not right of Redemption for the buyer. Most States allow a Redemption period after the Foreclosure Sale where the owner can buy back the house. Louisiana does not. And the Lender can sue for a deficiency balance.

Some of how quickly your Foreclosure will go depends on your Lender. If your Lender is carrying a lot of REO properties on their balance sheet right now, they may be inclined to move more slowly. If the Lender doesn't have a lot of Foreclosed properties right now, they move more quickly.

Either way, it sounds like you should look for some place to move to and just wait out the time until your retirement income drops out of the 6 month pre BK earnings period. You can allow the Foreclosure to move forward now and discharge the debt later in BK.

[Tonyababyrn]

Thanks!! for you reply. Thats was I was thinking--find a place to live, let them foreclose, then file Ch7 after the retirement drops off.

I have another question--I want to go back to school in Jan--I currently have student loans that are in deferment due to our financial situation and I know that while in school, no payments are due. If I get another student loan in Jan to go to school--do they count the amount over tuition, books, etc as income??

[SinkingFast]

Maybe others will chime in here for you.

Our only experience with Student Loans is the Stafford Loan program. Son got one for this year. 06-07 Academic year. The amount he got barely paid his tuition at the local 2 yr State College with a tad left over for books. So there was no excess.

[lrprn]

Thanks!! for you reply. Thats was I was thinking--find a place to live, let them foreclose, then file Ch7 after the retirement drops off.

I have another question--I want to go back to school in Jan--I currently have student loans that are in deferment due to our financial situation and I know that while in school, no payments are due. If I get another student loan in Jan to go to school--do they count the amount over tuition, books, etc as income??

FinAid has a really good section on student loans and bankruptcy at http://finaid.com/questions/bankruptcy.phtml . Under the circumstances, it might be better to wait one more semester and let the bk run its course before loading on more debt. Your case is complex enough, it will be well worth your time to have 3-4 free consultations with several experienced bankruptcy lawyers in your area to ask all your questions. You have a case that could use some real legal opinions.

We're glad you found us! Hang in there, keep asking questions. We'll help out with answers whenever we can and provide emotional support and a place for venting 100% of the time! There are several nurses hanging out here at the moment (myself and Arkienurse for two) - so don't feel alone. Hope your health problems are improving.