Budget Questions...

[Ckacrum]

Is there anyone here with a family of 3 or 4 that could share what kind of budget your being allowed in your c13? We're a family of 4 in Indiana.

In a couple weeks we're going in to sit down with the paralegal and lawyer to discuss our budget plan before filing. They have alotted 3 hours for us. Makes me feel special, as it should for what they charge.
The question is: am I in for a suprise?
Plan payment was quoted in the beginning at $365.00. After I figure up our utilities and taxes, house, etc.. i'm coming up with a 1758.00 to the good out of our monthly income. So you figure that's 439.50 a week for living.
I'm maybe silly, but I can't believe from all I have read that the trustee is'nt going to want, let say, $100.00 more a week to goto the plan. Rasing the payment to $765.00 or so.
Our checking statements do reflect a high monthly out pouring of cash, usually more than we brought in, but we did not spend it on goodies! We haven't bought, say, a "want" for ages!! It's just the high cost of my family's living and dad's lack of emplolyment cash flow. Which is getting back to normal.


The lawyer has to be smarter than that, right? He's not going to send us 2slaughter is he? I've seen the Indiana exemptions and allowance's.
If the trustee is gonna break my you know what's and leave us with barely enough, it almost pays to go ch7 instead if we're left with about the same amount monthly. We'd have to get the 2nd mortgage current, which could be done. He did say we could do either ch13 or ch7, but stripping the 2nd is what we're after.
I just don't like the fact of some guy telling me what I need and don't need money wise to support my family. I know i've mishandled our credit and we're going to pay for it. Frustrating!

Thanks

[rrockinggramma]

it will all be about disposable income. And plan on it being a tight budget. You probably won't have as much left over as you think when all is said and done. If your goal is to strip the second then remember that each month it is difficult to find the wherewithall for living expenses.

Whatever the disposable income is is what your payment will be.

Be prepared for quite the lifestyle change. It can be quite a shock and many times you will be thinking "wow I use to just pull out that old credit card and charge it and now what will I do to cover this?" But you will figure it all out I am sure. Just make sure the family is all on the same page cause if they aren't it will be harder to deal with.

And some padding is allowed and attorney's do it all the time. But it is amazing how good it looks on paper and then how hard it is to actually live on that amount. Good luck!

[Ckacrum]

Well, according to the online means test and my measely $4000 gross income monthly and being $1800 under the median for a family of 4 in Indiana we have no DMI. Our lawyer didn't see any problems on being able to afford a 13, even with no DMI. It's very confusing to us.
I'm just concerned about after the meeting's and conformation and getting the plan rolling that I don't want to fail due to being strapped. Though we've been strapped for awhile now, maybe it won't be so hard adjusting to actually having money for a budget. hmm..

Though if we get a crappy budget and have roughly the same if we went ch7, i'm switching to a 7. The lawyer probably won't like it, but he is'nt in our shoes.

[rrockinggramma]

well if I were you I would look hard at a chapter 7 any way. You want to strip the 2nd which is why you are even considering the chapter 13 to begin with but I would think long and hard about how important that is to you before you sign the final papers. What happens if you go chapter 7 and have only your mortgage and vehicle payments to pay after discharge. Or does the 2nd put you over the top anyway? If that is the case, then you need to think long and hard about everything, including being able to afford your home to begin with.

But if stipping the second is your ultimate goal, then any sacrifice you make will be worth it.

[Ckacrum]

Well our lawyer explained to us the advantage of stripping it. The interest we would save is a sizeable amount. Our house is under water by $8900.00 and the 2nd is $19000. Our house payment is only $596.00. We could not rent anywhere here with the 4 of us for cheaper.

We also have a van that is 19 months from payoff and i'm not turning it in for nothing! So close to paying it off, i'm not going to lose it. It is worth roughly $10,500 and we only owe about $6000. Would there be trouble if we went ch7 with the intent to keep the van?

I looked at the possible expenses and they breaK down like this:
Ch13 Minus expenses for month(Home, ch13 payment, utilities, etc.) $1388.00 a month
Ch 7 Minus expenses for month(Home, 2nd for 9 more years, utilities, etc.) $1176.00 a month until van is paid off in 11/10
I'd probably get a vehicle for a cheaper payment then so we could say add about $75.00 to the ch7 total.

What to do!!

[rrockinggramma]

well with a mortgage payment of less than 600 a month you are right, keep the house and strip the second. Just be prepared to live on a tight budget. Let us know what your final payment ends up being.

[Ckacrum]

Just be prepared to live on a tight budget

Thats my main concern. How much is our weekly budget amount. Though it will be more than before. Stealing from Peter to pay Paul! lol

[Ckacrum]

I'm curious. Would our lawyer be able to protect our van if we went ch7? We have 19 months left on the loan and about $2000 equity in it.

[flower04]

We have a family of 4. Our budget is about $100-$150 more than the allowed IRS expenses for our area/county, etc. We had to provide documentation why we needed to spend more in some areas (Dr. bills, co-pays, school tuition, car repairs, etc.). If you plan to "pad" your budget as other posters have suggested, you should start doing it NOW so that you will be able to back it up with documentation/receipts, and it will reflect that way when your attorney looks back at the last 6 months.

We were able to keep an additional $250 a month to pay for medical expenses based on our past 6 months medical bills. This is one of the reasons why we are filing 13. 2 surgeries in 6 weeks with lots of recovery had almost killed me, financially and literally. So, just keep good records and good luck with the mortgage thing.


HTH

[Ckacrum]

Well, Monday we go in to the office to do our 13 budget and i'm worried.

I ran another budget with all outging bills, house, ch13 payment(at what they think it will be), utilities, and a few misc., and i'm worried.

Final leftover will be around $1225 a month with stat's from our last 6 month income.

That's not even a full food, clothing, and house goods allowance. Let alone the allowance for vehicle operating expenses and medical expenses and whatever else allowance I should get.

I'm feeling their going to have to drop our 13 payment from $365 for 5 years down.
We were trying to keep a secured piece of property, but it's going to have to be returned, so hopefully they can drop it from 5 to 3 years and a low payment, because we're not going to struggle for the next 5 years and have to do a conversion in the future wasting all that money into a 13.

What do we do? Having $300 a week would enough to get by possibly, but there would be very little left to save for an emergency fund. The 1st disaster would probably wipe us out and there goes the ch13. i work in the auto industry and if we have another bad beginging to 2010 like last year I know were going to suffer bad!

Doing a ch7, we would have even less because of having to keep the 2nd mortgage, which is not secured because our house is under water enough to make it unsecured.

Feel like we are in a lose lose situation!! Kinda feeling hopeless!