New To The Forum

[JOSEPHLB]

Hello.. new member here.. making my appearance

Been searching and reading for a few days..hope to gather alot of valuable information..
I'm new to contemplating bankruptcy.. but not new to creditor & collection agency harrasment... so, hopefully in the near future I'll have loads of questions to ask.


Thanks!

[Peevee]

welcome to the forum

[Minnymouth]

WELCOME TO THE WORLD OF "BANKRUPTCY MADNESS".......

Share you experience, ask questions, we will try to help you thru this process....

We have all been there, done it, or just now going thru it..... and we lean on each other.

[JOSEPHLB]

I do have a couple of questions. I've been reading the site for the past couple of hours and there is just an enormous amount of information here.. good stuff..

Based on what I've read.. I am probably on track for a Chapter 13. I make about $10k more than the median income for two person family (Maryland). My wife doesn't work and I provide for her.

The problem is, I'm kind of in an emergency situation. I have about $21k in unsecure credit/revolving debt; all charged off from back when I was unemployed for 13 months from Sept 02 - Oct 03.
Some of it has expired on time limitations statutue.. but some of it is still tolling. I am in the process of being sued by an attorney for one of these debts that I believe I could fight it on bases of SOL expiration. But I am finding this could be a headache. I've submitted my answer and intention to defend notice to give myself some time; but the trail date is June 12th. That is still almost a month away; I'm also aware, that if they do win, they'll still have to file a motion for a writ of garneshment, which could still take some time.
When a bankruptcy is filed, when is the "Stay" actually implemented? I know some attorneys are computer literate, so filings can be submitted electronically, but is the stay in place once a petition has been filed?

Also, I currently do not invest in any retirement or life insurance, but I want to. Would it be considered fraudulent if I started to do this at this time? What is the allowed time for "Bankruptcy planning" ? This is kind of sticky, since I have limited time, since I am being sued.
I've had steady employment for almost three years now, so I am definately worried about the pending lawsuit and cannot possibly afford to have those scumbags garnish my wages.

[Rover]

When you file for any kind of bankruptcy, something called the “automatic stay” goes into effect. The automatic stay prohibits creditors and collection agencies from taking any action to collect most kinds of debts you owe them.

Most common type of creditor collection actions are stopped dead by the stay—harassing calls by debt collectors, threatening letters by attorneys, and lawsuits seeking a money judgment for credit card and health care bills.

In other words, when you file BK, the lawsuit comes to a screeching halt. To make sure that happens, you would want to file a "Suggestion of Bankruptcy" motion with the court.

[jane taylor]

Welcome aboard! Fasten your seatbelt tight--this is one wild ride!!

Don't know that you'll be able to get away with putting money into savings right now, but you can do home repairs, car repairs, buy clothing, etc. as part of the pre-BK planning. The automatic stay is really and truly just what it says. You may have one or two stragglers after it goes into effect, but then just give them your BK number and your attorney's name and number and they won't bother you anymore.

We'd gotten really creative on how to answer the telephone and it is nice to answer it like "normal" (whatever that is!) people again.

You WILL be just fine. The 341 meeting is over in the blink of an eye. Do your homework, but also let your attorney do his/her job.

Take deep breaths, take good care of yourself, and always feel free to vent. Lean on us. We are here for you. This is a great bunch of folks and Minny is the best!

Good luck and God bless!
jane

[SinkingFast]

Just because you make $10K more than the Median does not mean an automatic Ch 13.

Do you own your own home?? Will you continue to make payments for more than 5 more years?? If so, there may be Secured Debt there you'll get to deduct on the Means Test. Do you have a child from a previous marriage that you support?? You'll get to deduct the child support payments. The Means Test isn't as straightforward as it initially appears.

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

You'll find the Schedules for the allowables for expenses there. Say your rent and utilities allowable is $950/month, but your house payment is $1500/month,........ You'll get to deduct the additional $550/month as Secured Debt farther on in the Means Test. As long as you can annualize it out, forward, 60 months, that is.

As far as pre-BK planning goes, the Court likes to see consistency. If you go out and do something now that you haven't been doing all along, it will raise more than a few eyebrows with the Court. It will look down right fraudulent.

If you went and tossed a bunch of Cash into an ROTH IRA and then filed BK, that would not look good. You have to provide the supporting docs for all your assets and such. Once they see the date, you'll be screwed.

We carry substantial life insurance. But we've had that policy for years. In one of the Corporate Sales, the life insurance carrier offered for us to COBRA the coverage we had in effect at the time of the sale. We checked rates other places offered for similar coverages and simply could not beat the price. So we took it. But like I said, it's been effect for nearly 10 years now.

You could probably get away with purchasing a modest life insurance policy for yourself and your wife right now. But don't go buying a super douper louper of a life insurance policy.

If you have cash to unload, buy Money Orders or get Cashier's Checks to pay your house payment/rent set aside. Same thing for car payments. If your auto insurance is rolling up, pay that ahead of time. Grocery shop. See the doctor and the dentist. Don't forget, you're gonna have pre BK Cert fee, attny fee, filing fee, and post BK Debtor education fee.

If you're anything like the rest of us, you're gonna be scrambling to pull together the docs your attny will want. Last 4 years' income taxes with all earned income statements. 3 months of utilities bills, bank statements, your mortgage and/or lease agreement. If you've bought or sold property within the last year, you'll need paperwork from those transfers. Any bank accts closed within the last year,...... you'll need info on that. There's more. Every attny you consult with will give you a list. Our paralegal told us the attny wanted all this stuff on file incase he gets audited.

[JOSEPHLB]

I do not own my own home. No children. We live in a basement apartment paying rent; only about $300 / month. We don't even have documentation supporting this, since its my uncle-in-laws house. We share the utilities with my wife's sister. Their family lives upstairs. Most of the utilities are in her mothers name, who doesn't even live here. So, I have alot of issues, that I can't really document, but I'm obligated to pay. My situtation is just a big ole mess.

[SinkingFast]

My situtation is just a big ole mess.

That's qualification to be a member if I ever heard it!!

Welcome to the Club!!

Seriously tho,..........

Expenses may be a real issue for you. Beyond the Means Test are a couple of Schedules that get compared to the outcome of the Means Test.

Schedule I is income. Schedule J is expenses.

Schedule I is obvious and easy. Your paystubs for the last 6 months get annualized into a yearly amount.

Schedule J is where you list out what you actually spend to live. Your actual rent, utilities bills, groceries, clothing costs, etc.

Sounds like you might have some real problems proving to the Court how a chunk of your money gets spent. At least on the bigger bills like rent and utilities. Could you possibly get some sort of Lease agreement written up that shows you pay $X for rent and utilities to Uncle and Aunt?? That would help.

Another thing that will help you is saving receipts from purchases. At least get a handle on what you spend on food and such. Also, think back over the year about any car repairs you've had done. Buy new tires? Add all that up as best you can and divide by 12. How much you spend on gasoline each month. Same thing with medical. Your deductibles is a good start. Do you have any regular scripts that get filled every month. Figure up your out of pocket on medicals expenses.

Food, clothes, money spent on entertainment, household cleaning supplies, dry cleaning and such, you won't need actual receipts for. But the big things,..... Rent and utilities,........ We had to give our attny our lease and 3 months of utilities bills. They copied all that stuff, scanned it into our case file in their system, and gave us the originals back.

[JOSEPHLB]

I spoke with an attorney Friday afternoon. He was "guesstimating" I would be paying $500 / month on a Chapter 13. I'm sure that isn't accurate at all, based on he hasn't even computed anything yet..
I can probably get a lease agreement written up to account for our rent.

The attorney I spoke with told me it would cost me $1104 for the complete bankruptcy.. $750 for his fees, the bk fee, credit reports, and the $50 for the pre-bk counseling...
Supposedly he said he has done over 11,000 bk's and was voted one of the best lawyers in Baltimore..
I asked if his organization was computer literate, and could file electronically, he said it could all be done in 48 hours, once all the paper work was provided.

Now, he mentioned about having to own the autos for at least 910 days to "cram down" the obligation toward the current auto loan. Does that mean I have to have been paying on the auto for 910 days, or does that 910 days begin to start once I drove the auto off the car lot? I mean.. I figured once I have that vehicle in my possession, I'm obligated to take care of it, and have full coverage insurance provided on it, etc..
My only concern is I have a vehicle, that I still owe $12,000 on, but I looked at KBB the other morning and it is only worth approximately $3850. It needs a full brake job, tires all the way around, emissions work, cracked windshield, etc.. Probably a good $2000 in work needs to be done to it.
If possible, I would like to be able to surrender this vehicle, somehow..

[SinkingFast]

Yep,......... They changed the cram down rules in the New BK Law. Used to be, you'd only have to pay what the vehicle was actually worth. Now, the entire car loan is considered Secured. Regardless of whether you have equity in the vehicle or you're "upside down" on the car.

And, the ability of a Ch 13 filer to simply return their vehicle to the lender is being challenged as well. I don't know if an Opinion has been rendered on this case yet or not.

Here's a link to an article discussing Ch 13 and car loans:

http://www.bankrate.com/brm/news/auto/20060313a1.asp

[katze]

I don't know about other people but we didn't have to have any documentation or receipts or any proof of our expenses. We just filled out the schedules and the Trustee accepted them.

[JOSEPHLB]

I don't know about other people but we didn't have to have any documentation or receipts or any proof of our expenses. We just filled out the schedules and the Trustee accepted them.

The only thing the attorney I spoke with informed me that I would need to bring to him would be:

Last 4 years tax returns
6 months of my banking statements
6 months employment pay stubs
Titles to my automobiles
SS card
Drivers License

[SinkingFast]

I don't know about other people but we didn't have to have any documentation or receipts or any proof of our expenses. We just filled out the schedules and the Trustee accepted them.

We didn't have to show receipts for normal expense stuff like groceries and such either.

The problem was, we were using CC's for everything and had no idea how much we spent on anything except what we were billed for monthly.

Many people don't know how much they spend to live. That's why I suggested saving receipts for a while.

Also, if you have a special diet, you might need receipts to document food expenses if you're claiming more than the Schedules allow. Like if your diabetic, or have high blood pressure, or kidney disease, or some other medical condition that may require a special diet.

Other unusual expenses, you may need to document. Say you're a traveling sales person. You get oil changes weekly, buy new tires every year, and have HUGE gasoline expenses. You'd need to be prepared to document those types of expenses.

[JOSEPHLB]

I have also discovered that my wife threw away all the receipts for all the fertility drugs we have had to purchase this past year. That sucks royally; that was a pretty penny or two..
The other night I lost half a nights sleep just trying to think about what to do. Most of the attorney's I talk to tell me I'm going to have to do a chapter 13. Doing that is going to tap me out for five freaking years. Especially with a child expected this upcoming January '07.