New here..looking for an opinion..

[ladyjenn]

Hi all! This is my first post. (Actually second, I posted this incorrectly elsewhere). OOPS
I have an appt. on Monday with a BK attorney to see if we qualify for 7 or 13. We live very modestly, and after bills are paid, have only about $5.00/month extra. We are current on everything, but are scraping by, by the skin of our teeth. We have a$70K home with most of that still being owed, make about $59K/year, and about $35K in unsecured debt.....any thoughts?
Thanks so much in advance. This has been a very hard decision to consider, but I am so tired of not being able to breathe and worry if something unforeseen comes up, we are REALLY in trouble.

My biggest fear is that the attorney will say we don't qualify, then what?

Jenn

[SMinGA]

When you say you have $5 left, what is that considering?

If you have not already done so, sit down and think about what your bills and expenses really are. For expenses, consider groceries/clothing/transportation/household needs. Focus on needs, not wants. At this moment, do not count credit card payments. What is the bottom line, when you deduct bills/expenses from net income?

If there is $ remaining then 13 is a possibility. If not, 7 might be better for you. At $59k a year, depending on family size, you're probably under median. Meaning if you file ch. 7 it will be easier than if you were over median. And if you file ch. 13 you have the option of a 36 month plan. (Over median must do 60 months.)

[ladyjenn]

CC/Unsecured Loan payments are roughly $1000/month, so that is what we would have left without paying ANY of our debt.
PA median is $77K, so we are well under that.

PS...thank you so much for replying and trying to help me!

[DeadManCrawling]

You need to revise your plans, one way or another.

If $1,000 per month would REALLY be left over, you will be forced into a CH 13, possibly, even if you are under median. It has happened to others.

That being said, I doubt you are realistic in your expense list. There are many things most of us forgo or are lax about when we are under the pressure to pay credit cards and unsecured bills. Think of things like: when was the last dentist visit? Eye care? Purchases of vital things like vitamins? Even clothing? All of these are legitimate expenses (and there are tons more, look around this site) that many of us skimp on to pay credit cards.

These are expenses you need to include in your schedule, even if you aren't currently spending on them. They DO count going forward, and you are not expected to live in that "survival mode", ultra-lean fashion forever.

Think hard about expenses, you almost certainly missed some important ones, or have not paid them in so long you may have forgotten they are even necessities at all.

Best of luck,

-dmc

[frogger]

You need to revise your plans, one way or another.

If $1,000 per month would REALLY be left over, you will be forced into a CH 13, possibly, even if you are under median. It has happened to others.

That being said, I doubt you are realistic in your expense list. There are many things most of us forgo or are lax about when we are under the pressure to pay credit cards and unsecured bills. Think of things like: when was the last dentist visit? Eye care? Purchases of vital things like vitamins? Even clothing? All of these are legitimate expenses (and there are tons more, look around this site) that many of us skimp on to pay credit cards.

These are expenses you need to include in your schedule, even if you aren't currently spending on them. They DO count going forward, and you are not expected to live in that "survival mode", ultra-lean fashion forever.

Think hard about expenses, you almost certainly missed some important ones, or have not paid them in so long you may have forgotten they are even necessities at all.

Best of luck,

-dmc

Excellent advice!

[ladyjenn]

Thank you so much! Is all stuff that I have to think of ahead of time or is there some kind of worksheet the lawyer will provide? I have done without some of this stuff for so long, it doesn't even come to mind.
You guys are awesome, I am a nervouse wreck about this, and I am sure we will end up being 13. What is the typical payback %? Anyone familiar with that, or should I post that ?? elsewhere?

[feelingnutsy]

Hey---ladyjenn---if you haven't already done so---make sure that you've
done a very honest-to-goodness and extensive budget for your lawyer---
and see what you really and truly need---and you'll be surprised how you can
reroute yourself away from the credit card payments---to buy the essentials.

[ladyjenn]

I worked some numbers up last night and I can not believe how much better things look (for filing, but worse in real life). With mortgage and living expenses (life insurance, utililities, haircuts, braces for one kid, gas, groceries..on and on......) it makes a huge difference how we could live without the stinkin' debt!
IF we can do Chapter 7, should we, or go with 13?

[keepmine]

Absolutely file a Chapter 7 if, you qualify. It's over in 90-120 days as opposed to 60 months of payments in a 13.

[ladyjenn]

That is what I was thinking. Anyone else here have a hard time coming to terms with their bk? I am still current on my bills, but I live without A LOT, and my kids live without A LOT! We all wear the same clothes every week, some weeks I can't afford groceries, and there is very few "extras" for them, and so on. I just am ready to swallow the pride pill, and get a fresh start, I think. I am almost feeling guilty hoping we get Ch7, but I am hoping for it as well....

[newbie2]

That is what I was thinking. Anyone else here have a hard time coming to terms with their bk? I am still current on my bills, but I live without A LOT, and my kids live without A LOT! We all wear the same clothes every week, some weeks I can't afford groceries, and there is very few "extras" for them, and so on. I just am ready to swallow the pride pill, and get a fresh start, I think. I am almost feeling guilty hoping we get Ch7, but I am hoping for it as well....

I would venture to say that we've ALL had a hard time coming to terms with being bankrupt. You have to do what is best for your family. Not buying groceries is one of the reasons that some of us finally saw the light and filed.

Good luck to you!

[ladyjenn]

I just did a budget, and about got sick! We are upside down $1200.00/month!

[Amadan]

You will need to take several things into consideration when working up your "budget". check out the IRS standards for your area for food, shelter, ect. its all available online. You can download forms for the means test and schedules I & J and play around with those as well. The thing some people, myself included, have a hard time with is working up a real budget. Things that are NEEDS, not things that are WANTS. You may have to downgrade or cancel cable tv, you may have to start buying generic or store brands instead of name brands. If you make it to a 7 the pain may not last as long, but you will likely have to learn to live within your means, and that is the whole point. For those of us in a 13 the lesson lasts a lot longer, but the end result will be the same.

[blessed]

Our situation is similar. Our house is modest and our CC debt really was modest too. But paying the minimums on $31k worth of debt with the interest rates rising was never going to get us out of the hole, and never allowed for any savings or extras. We were living on the bare minimums of everything and making it, miserably without a future. Any equity we were building in our home was going to be eaten and that's just not right when we had paid so much toward the cards that in reality they were "paid in full".

Go for a chapter 7 if you can. Stop paying the unsecured debt and use that money for necessities. Once we stopped paying we did end up with a surplus. But our true budget didn't actually reflect that, we were used to skimping and it was actually hard to change the habits of not having money! The budget going forward does reflect expenses that are within the IRS guidelines and because we don't spend all of it on those items we have build a savings in a matter of 4 months.

Eventually you'll wonder why you didn't do this sooner. GL!

[marie]

We actually eat much better since our chap 7!

I used to spend so much on paying credit cards, that I never had any money left for food, so I would use a cc, but feel guilty and not buy much, so we never seemed to have any food in the house, and would eat soup, or scrambled eggs and toast, very basic stuff.

Now I actually have a food budget ( cash ) of $100 a week, which I spend wisely and we eat a variety of tasty and healthy meals. We don't eat out much, and still don't have a lot of wiggle room, but I am not as stressed.

We are waiting for discharge, and just hoping that nothing will crop up between now and June 22nd.

Good luck to the OP..I'm sure your family will benefit if you can get into a chapter 7.

ALDI is great for basic groceries if you have them nearby...and they are cash or debit only..No CC's allowed !