Facing the music

[adjustingtoit]

I'm in the process of filing a 13- Make to much money {household} to qualify for a 7. I rent an apt with my wife of 29yrs. Both Kids are grown up and out of the house and my son is serving our country in Iraq. I have a 2006 lease vehicle I plan on keeping along with a RV that is secured by a personal loan. We both have good jobs in public safety and she pays most of the bills. I fell behind for a couple of reasons. I'm about 30 days late on all. I have approximately 45k in unsecured debt. One reason was due to a substantial cutback in hours at both of my jobs. Another was the relentless increasing of my credit card rates. For instance, Crap 1 raised both cards because they could. Went from 12% to 19%. I had a perfact payment history with them. I have always been on time not a nick on my reports. I'm partly to blame too and I'm ready to "face the music". I had my first meeting with my attorney it went ok. Thats when we gathered paperwork and did the credit course. The next meeting of over 2 hrs didn't go as well. The means test..urgh..you know-- the thing the banking industry and credit card companies came up with. He basically said I'll have to pay around 1000k a month for 60 months. Ouch. He said my wife's income is creating more "disposable" income to pay my foaming at the mouth creditors. I can afford 1000k a month, I guess, as long as I eat beans and don't buy any clothes. Thank you IRS for those useless tables. I know I've made some mistakes and I'm ready to pay for them, but the trustee is going to have a ball with me I'm sure. How can this be a "fresh start" ? How can I start a emergency fund. I was always dipping into it to pay the increasing fee's and minimums on the cards. I will get raises and so will my wife, we're state workers..so I'm sure to be scrutenized the next 5 years, but what I can't figure out, doing the math, 1000k x 60mo is 60k -- I owe about 45 k in unsecured debt. You can't tell me 15k is for my lawyer and trustee.

any insite from a veteran 13k person after the new laws
is appreciated--
thinking about dipping into my wife's deffered comp and pay her back--she loves me

thanks for reading

Kev in NY

[rrockinggramma]

Well if I were in your shoes, and your wife's income is going towards the trustee payment, I would throw everything, his and hers into the pot and file your chapter 13 together. You could quit the second job, wait a few months and then file with less income. In addition not all of your creditors will file claims, so you may end up coming out of the chapter 13 sonner than 60 months and in a chapter 13 creditors cannot raise their interest rates. You could consider another lawyer opinion as well. And I would never dip into your retirement fund and steal from your future to save now. Keep the retirement fund intact, both file together, and then look forward to retirement. As to the 15,000 excess, there will be some lawyer fees and trustee fees, but it looks to me like you will not be in your bk for a full 60 months. Others will also offer their opinions, but this is my 2 cents.

[keepmine]

Why didn't you ask the lawyer why the $15K difference. None of us will be able to help with that.
It's always a good idea to seek a 2nd or 3rd opinion.

[CindyLou]

my brother had 85,000 and only 30,000 filed claims! Of course you never know........they could all file.

[leftyf]

How much over the median are you? I'm at least $5K - $12K over and going for the 7...attorney thinks we can do it.

[adjustingtoit]

Re: facing the music

I'd like to thank those who have responded. Its good to know there are people out there who have been there done that or are going through the same thing. Its been a rough month and I know it going to get worse before it gets better. I never said anything to my attorney about the 15k. I didn't realy realize it until I got home. I meet with him monday and I'll have some new questions and concerns for him. I'm pretty confident with him. He's been in the biz over 20 years. He is a bit overwhelmed with new cases but I've sat with him at his office and watched everything he's done. He pulled my credit report and did the credit course right in the office with him. He uses the same means test and IRS tables as every other lawyer does so ditching him at this point isn't in the cards. He hasn't asked for a dime, except for the $600 filing fee and his fee's are included in a 13 anyway. He even said if I qualified for a 7 , I could make arrangements to pay his fee's. I do expect him to fight to get my disposable income at realistic levels however. The problem is, my wife and I both get forced OT. Our jobs are 24/7/365 and many times we have no choice so one week may be much higher than the next week. The upwards fluctuations concern me. I will ask about quitting my second job, but I've been there 12 years and I don't want to but I'll see if it will make a difference. As far as my wife filing with me, I asked. He said it would make things worse actually. He jokingly said I'd be better off seperated. I told him after 29 years together, that wasn't going to happen. He did say that he would check to see if I could file differently. I don't hold much hope of this working in my favor, but I guess this is why 70% can't make it through a 13. I've thought about waiting to file but the wolves are on the phone day and night looking for money and I'm sure it won't be long before the dreaded summons start coming. I don't want it to get to that point. Negotiating with them or using a debt company is out of the question. I refuse to beg or listen to music machines or slaves in a 3rd world country. They all want my checking account number. Yeah right. I don't answer the phone anymore unless its work or family. My wife paid most of her cards off and she only has a few bills now. We're trying to keep her solvent and there is really no need for her to file. Really, it wouldn't help the situation, just hurt it. I sold my house over 2 years ago and we really own nothing. When you sit down and think about it, its just about right. The 1000 a month is actually less than the 1600 a month I would pay if I paid everything on time each month. Scary isn't it? Its just I won't have any control of my paychecks anymore. Forget vacations and god forbid I need tires for my truck. But, I'm ready to get out of this mess. I want to retire bill free in 6 years but the other way, that wasn't going to happen. I look forward to hearing from you all. Thanks again--I'll keep you posted

[aa06a47]

Actually, your case should be a slam dunk, and it should be smooth sailing through the confirmation process. It appears you live modestly without much secured debt. If you had a house payment for example, the actual house payment amount would be what you would use in calculation of disposible income.

It is ironic that those with the most secured debt end up paying the least amount of money back to unsecured creditors and in theory end up with the most after the chapter 13.

[adjustingtoit]

Re: Facing the music

Well, had another meeting with my attorney yesterday and he's filing a ch 7. I gave him the $600 filing fee and off to the race we go. I didn't think I qualified for a 7 but he's going to try anyway. Maybe he knows something I don't but either way, I'm screwed for the next 5,7 or 10 years. He also had me get an appraisal on my wedding ring. He said the courts are on a jewelry kick right now Odd. Ohh well. He said come back in 2 weeks and we'll see where we are and shoot for round 2 if we have to. So I guess if the 7 falls through, we shoot for a 13. Maybe he's buying time, who knows, but I didn't argue. I just can't wait until this nightmare is over. It sure works on ya especially when your use to paying all your bills. My phone rings 15 to 20 times a day and now they are trying me at work. I'm sure as soon as the filing shows up, the calls will subside. Not sure if I should waste my time sending cease and desist letters out.

[vleisme]

Where did you get that information from aa06a47? I am filing ch. 13 on Nov. 1st my attorney did not use my mortgage payment amount as disposible income on the means test???? We owe 70 grand in credit cards and will be paying $200 per month for 40 months and the creditors will only be receiving 4%.It has not been confirmed but I would certainly hope an attorney that does almost exclusively BK's would know that information if it were true??