Chapter 13 - So many questions after meeting with several attorneys.

[Throwaway92]

Before you get too far into "planning" your expenses, don't forget you cannot make up expenses out of thin air. You need to have actually incurred those expenses and have receipts to show if requested unless they are at or below the IRS amounts. To some extent, you may have incurred gambling expenses within your household budget beyond what you financed. You'll need to convert household income spent on gambling and other non-countable expenses excessive food from eating out to legit household expenses. The big categories are financed cars, home maintenance, dental, medical, charitable contributions up to 15% of income, and a reasonable amount towards retirement.

I wonder about the $58k car. If you bought it recently, that screams bad faith filing. If it is a high monthly payment, it may be objectionable as well.

I think you should wait a few months to file and start spending like your post-BK budget to generate receipts for the trustee. You'll need to stop making minimums and use that money to pay for countable expenses. The delay in filing BK will also help make sure your recent gambling debt is dischargeable.

At the same time, you need to deal with the gambling addiction and the trustee might want documentation that you're dealing with the addiction such as self exclusion letters and documentation from rehab. There will be no room in your budget for even a single trip to the casinos or online betting. It will be very tight in the beginning.

Pick the best attorney you can find who has done lots of 13s and knows the chapter 13 trustees well. Don't worry too much about attorney cost. You will likely be financing part of the legal fees anyway and those fees are usually partially subsidized by your unsecured creditors.

flashoflight Thanks for the input. I do wonder about the car as well. It's a Tesla and I got it last August. I don't think it'll be seen as a bad faith item, mostly because when I got it I was making more money, until I got laid off in October.

My lawyer thinks I do have a good argument to make as far as justification for the cost. I commute a lot to bring my son to school (goes to the district his mom lives in) and my gas expenses were $400+ prior to getting the electric car. We plan on using the IRS standards for most expenses, except rent. I live in a high COL area and even with the IRS accounting for $1385 for rent for 2 people there is almost no way to actually find a place that cheap. $2000 a month is more realistic. Lawyer doesn't think this will be an issue because it just the reality of things.

[Throwaway92]

ThrowAway,

I was in a similar situation as you - getting a huge variance on proposed payments from different attorneys. I would suggest completing the 22-C form and the Schedule I & J forms (as mentioned earlier). You can pretty much find a solid estimate between these forms. I got estimates from $1300-$5200, with the final proposed payment closer to $2k. Beware of some of the online calculators as they seem to be pretty high. Do your best to find a good attorney - as they will know where to push and where to retreat. They will be key in getting you a good payment number.

Hi alexdrake23 - Thanks for sharing. Can I ask what income is? $5200 is a huge payment so I'm hoping you make A LOT more than me! Also, are you in a high COL area and what is the household size?

[Throwaway92]

Hi Throwaway92. Welcome to hell I mean... BK... just kidding LOL! I am Barbisi's partner in crime - the quiet guy who rarely speaks. Anyway. Couple questions, and couple thoughts. I scanned the topic so maybe some of these are already covered.

First off, and most importantly - breathe, brother - just breathe. You got this, and you will get through this.

1. have you filled out your I and J forms (income, and expenses)? If not, do it, before you meet with the attorney. Consider Every Single Expense - daily, weekly, monthly, quarterly, 4-monthly, annual. Write every one down. Medical, tax prep, trash, electric, water (all utilities) - you can get 12 month's worth, and average each one. These all go into the forms. Also - TV, cell phone, etc.

2. If you have not filed, and are considering enrolling in some form of rehabilitation for the compulsive gambling, make sure you have a copy of agreement to enroll, or some other documentation. If you do this, before you file, it *may* help your case. It may not matter, as well; but, if you can demonstrate a willingness and desire to reform, it may help.

3. For monthly household expenses such as: Food, Clothing, Vehicle Expenses (maintenance, gas...), hair care/cosmetics/personal care, child education expenses: Check the IRS website for the allowable expenses. You should be able to put these numbers down, as-is, on your I and J forms, since they are allowable expenses, versus combing through your monthly bank statements and deciphering all those expenses.

4. Automatic withdrawals from your bank account for bills - check for these; they can be easy to forget under duress such as when filing for BK.

5. Taxes - make sure you have your tax returns for the past few years available.

Basically, be sure you are intimately familiar with your financial situation - all income, all expenses. That way, when you speak with your attorney, and possibly the trustee, there won't be any guesswork.

You will go to an initial confirmation meeting thing; a 425, 6*6, whatever it is, I don't remember, and I really don't care <bla bla bla> but: you and your attorney have a quick convo with the trustee or their lawyer-associate. You probably will not meet the actual trustee. You are recorded on an mp3 recorder (not a tape recorder? So 1990s), answering some simple questions, and that's it.

In our case, we had an initial lower payment amount for about 4 months, before confirmation (you don't need to genuflect - Catholic joke but anyway). Then I got a call from the attorney, indicating the trustee agreed to a higher amount, but lower than the full amount requested. In other words, based on the evidence we provided for our financial/medical situation (bills, letters from physicians, etc. - this is why you need to be intimately familiar with your financial situation so you can defend yourself), the attorney and trustee negotiated a payment plan.

You and I are in the same income range, annually around 125K. I was initially earning about 96K when we started the BK, then got canned by Rathole I'm sorry I mean 'R', as Barbisi affectionately calls the company. Our payment is now around 900 + some change. Our initial debt load was under 110K. So considering you are in the same county as we are, with the same trustee, this may give you a barometer for predicting what your monthly payment may be. Each case is unique, however, so please that in mind as well.

We have 12 months remaining, then we are bailing Colorado, gettin outta Dodge by sundown.

Arighty, again, breathe, you'll get through this.

Hi Zombie13 thanks so much for the info. The lawyer did fill out a budget with me, not sure what the form was titled, but it broke down all of my expenses, mostly using the IRS standards. I don't have too many expenses that I can add on, outside of $50 copay for therapy related to gambling. I am just hoping there isn't a ton of pushback!! As I said, I will have the same trustee that you guys have (the one who I have been told is the way more relaxed one) but it sounds like you haven't had the best experience! I can only hope I don't have to go through that!! I'm glad we are at about the same income wise because it helps give me a better idea of where I may stand. You're mortgage is higher and you have more medical bills so I am hoping some of my other expenses (401k, child education, etc) can help offset some of it. I guess what I am getting at is that I would just be obliterated if I ended up with a $2000 or $2500 payment

[flashoflight]

Barbisi You guys have non-exempt equity / best interest of the creditors? I think that may be why you are having a bad experience with this trustee and maybe not representative with other debtors' experience. Non-exempt equity is very bad for your case because the trustee has to make sure you pay it all no matter what while the rest of the folks can have their payments reduced when life throws a curveball.

[Barbisi]

<Zombie13 typing as Barbisi, with Barbisi dictating to Zombie13, aside from the hot-sauce sarcasm, that's Zombie's special edition> Thank youFlashoflight. We will dredge up the original documentation so we can search for that terminology; I believe it exists in the documentation. We thought everyone in a 13 had to pay the same as if they were in a 7; i.e. "what's in the best interest of the creditors". Nonetheless, our most recent revised documentation indicated, 'they' will be *satisified* with the numbers presented in the letter. Meaning: we make the final 12 "lashings" er...
payments, as is, and be done with our penance/serfdom/servitude.