Newbies with questions

[joekel]

Hi, everyone here is our situation in Nov.08 we decided to sign up with a debt settlement co.BIG MISTAKE!!! 7 months later and $1140/month poorer we decided to file BK. Finally went to an Atty. He recomended chap13 do to the fact that we are trying to pay the creditors he also recommended this site!. Here are are questions and concerns:
Gross combined income $11800 month over median for nj family of 5
Unsecured debts $75000
1 month behind on mort
Atty said worst case would be to pay back 100% of debt does this mean $75000/60? If this is the case we could afford the $1250 a month
how does the trustee budget process work
I also have a company cc with my name on it, it is for work expenses only will it be effected
will we still be able to keep 2 children in parochial school they have been attending for 9yrs for the oldest and 8yrs for the other our youngest is not in school yet
We are going to the Atty on Tues 21st with these and many more questions sorry for random questions we are nervous and questions pop into a heads
Thanks for any advice and help joekel ask me any question about debt settlement companies

[optimistic1]

Most likely he suggested that you do a 13 assuming that you would fail the means test (over median), thus, pushing you into a 13.

Depending on your disposable income based on the Means test, that will determine your % payback, as well as a number of other factors. Your local court may rule differently on the matter of coming to a determination of your disposable income, your attorney will know how they deal with this.

The trustee budget process may work like it does in my district, the trustee establishes what he considers to be normal expenses, although, if you exceed what he considers normal, and you have proper documentation proving otherwise, you may be able to claim it as a legitimate monthly expense.

Your work CC may be revoked by the credit card company due to your credit report, although, the credit isnt in your name, so I dont see why they would care.

The trustee may object to you spending all that money on parochial schooling, although if it is a matter of religous faith, then you may have some type of a defense.

What asset's do you have? Some will be non-exempt, so you will need to determine how much they are worth, this will also determine your monthly payment. Do you own any cars ? Are you still making payments on them?

[walkthaplank]

If you are in a 100% payback plan, I don't think they'll look too close at your expenses. They'll also want to put your mortgage arrears into your plan. Also keep in mind that the trustee fee will be on top of your payment. If your lawyer is experienced and is confident he can push it through, you should be fine.

I looked at the debt settlement option, and just researching on the forums on their own websites told me that most of them spend a lot of money and end up filing bk anyway. Debt settlement can be an option, you just need to research it heavily going into it.

Good luck with your filing!

[joekel]

More questions

Thanks optimistic1 and walkthaplank I am assuming that it will be a100% payback the Atty said that would be the worst case just wanted to make sure my math was right $75000/60months The only assests we have are a 2001 chrysler mini van with 72000 miles valued at $4500 no payments we own it and jewelery valued at $1500 (pawn shop estimate) other then an annuity not a 401k plan and furniture that we own not much.Our house's value dropped so really no equity maybe $15000. We feel so stupid about our situation it took 20 yrs but it finally crashed. Sometimes things make you smile last week we received an app for a credit card my wife and I couldn't believe they still send them to us. Again thanks for any advice and help joekel

[optimistic1]

If its a joint petition, you will probably be able to double the vehicle exemption, but dont hold me to it. Otherwise, if you could not, you only get an exemption of 2500 for a car. Leaving the balance of about 2000 that will need to be paid into your plan, if you plan on keeping it.

Married couples receive a homestead exemption of $100,000 which more than covers you on that.

Is any of the jewelry you own wedding rings or watches?


Lets assume your numbers are correct about the $75,000.

You will then add in the value of your non-exempt asset's, which is assuming you cant double the vehicle exemption, would be the balance of $2000, then add in the jewelery value of $1500. Now you are at 78,500, then you need to add in the trustee fee which for the eastern district of New York, I am assuming you are in the eastern district, is 10%, which is $7,850.

Grand total is 86,350, divided by 60 months brings you to $1439.16 to pay into your plan, which is probably much less than what you were paying on minimum monthly payments for unsecured CC's.


Oh yeah, I forgot to add in your arrears, which may have interest included on it, but if your only 1 month behind it shouldnt add up to that much, just add the amount you are behind on and add a little extra for interest to the $86,350 figure and then divide it by 60.

[joekel]

Thanks again

optimistic1 yes the jewelery is for my gold wedding band my wife's engagment ring and and a diamond anniversery band and 1 nice watch that is 10 yrs old anniversary gift also included is miscellaneous gold chains am I being too honest and does the trustee want to see the items.How do they get value of the car I did kelly blue book and was being kind to ourselves not knowing how the BK works . I put this info my initial sheet for our cert. and atty paperwork nothing offical given to trustee yet. Can I change them; the car needs work ie power lift gate and power side doors don't work and is it possible the trustee comes back with reduced balances? I live in South Jersey across from Philly don't know if trustee fees are different then ENY Like I said earlier we have a million questions popping into our heads and writing them down for our atty .joekel

[optimistic1]

If you havent filed anything yet, then you can get a more accurate value of the vehicle. If I was you, I would value it using Kelly Blue Book, Private Party Value, at fair or even poor condition, being that it needs repairs, that should lower the value down by about a thousand dollars.

Some or even all of the jewelry may be considered exempt under personal property. I have noticed that a lot of attorneys just lump it all together and consider it all exempt, some states will make this meticulous list of each and every item that is exempt, but most attorneys don't even follow it.

Its possible that you are not in the eastern district, maybe the southern, which has a slightly lower % rate for the trusteee, which would lower your payment by maybe $50 or so from the figure I gave you above.

Just wait this thing out, and go meet the attorney, they will know much better than I or anyone else online. Dont be afraid to make another consult, or even a third or fourth with more attorneys.

[joekel]

Just getting nervous

optimistic1 maybe I am getting to much info to fast I will wait for the 21st when we see the Atty My wife just reminded me that the Atty already said our jewelery number was high Just concerned that I will be paying some crazy amount but like Atty said you can't pay more then 100% of the debt I think you are going to be hearing a lot from me sorry if I am bugging you Thanks joekel

[walkthaplank]

optimistic1 maybe I am getting to much info to fast I will wait for the 21st when we see the Atty My wife just reminded me that the Atty already said our jewelery number was high Just concerned that I will be paying some crazy amount but like Atty said you can't pay more then 100% of the debt I think you are going to be hearing a lot from me sorry if I am bugging you Thanks joekel

Everybody here has been or is currently nervous and anxious. They can't make you pay more than 100% of your debt (excluding trustee fees of course, they get paid too). Remember your values for personal property are yard sale/pawn shop values. You want to make sure as much as your stuff as legally possible is exempt. Your attorney will help you with this as well.

Relax and let things take their course.