Ready to File

[fugazzi]

So my wife and I decided that we are going to go ahead and file for 13 soon. I posted some questions earlier about just letting my wife file, but after talking with an attorney and really looking over everything we feel this is the best options for our fam.

Here's the situation:

1. Credit score for both of us is over 700 (bye, bye )

2.Have never missed a payment on anything, and all accounts up to date, but charge
card is too high to be able to pay anymore and can't keep floating like i have for last 2yrs on it anymore.

3. Own 1 house with 109K remaining on mortgage, valued around 140K. 958 a month payment.

4. Own 1 piece of property with 41K remaining on loan, valued at 35K. 250 a month payment.

5. Own 1 car (CRV) free and clear valued about 4K.

6. Own 1 car (Versa) with 16K remaining, valued at about 16K, just bought in Aug 10', 309 a month payment.

7. Have 1 student loan with 3K left, 80 a month payment.

8.here's the bad guy: 86K in unsecured CC debt, 1850 a month min payment. paying about 800 in interst a month, Also 4.5k is a charge card that has to be paid off each month, and i'm having to pay it, then live off it the next month, etc..

I will be keeping the house and surrendering the piece of property.


Now for my questions:

1. Will they make me give the Versa back since i bought it not long ago?

2. Since my income is pretty high (5900 net/mo), and will easily be able to pay 100% over 5yrs will they force me to repay the 86K over a shorter period of time?

3. I'm not going to make anymore payments on my cc's till i file, how long should i wait?

4. Current lawyer i have been to charges 3500 for filing chapter13, is that high?

Thanks in advance!

[PhantomPain]

From what I know so far.

1) No - you'll be able to keep and goo thing it's new. It was suggested by my attorney to buy a new car then file since it will have to last while i'm in the 13...

2) I have the same amount .... 86K or so. I'm probably end up paying about 35% of it over 5 yrs. It pays to document EVERY expense before filing.

3) I haven't filed yet. I stopped making payments at the end of November. Going to try and wait another couple of months. My attorney states that some wait much longer. My attorney only requires $1500 up front plus the filing fee and the rest can be payed off during the 13 plan. So - I have it at the ready in case I need to move. Otherwise - I'm getting things done around my house that need to be done.

4) $3500 is just about right. in fact, I don't believe they can charge more then that. You may be able to pay some of that off during your 13 plan.

Good luck! I'm no longer stressed about this and know I'm doing what is right for my family and our future. Cash is king!

[fugazzi]

yeah they only require 500 up front and the rest can go into the plan. Have the cc companies sued you yet?

[fugazzi]

Another question, since i wont be paying my cc's for the next few months, i will be able to save up some cash for an emergency fund, but will they take it during the BR?

[lrprn]

Another question, since i wont be paying my cc's for the next few months, i will be able to save up some cash for an emergency fund, but will they take it during the BR?

It depends on your state's bk exemptions. Some states protect cash or have a wildcard that can help. Other states have nothing. Talk to your lawyer about how much cash you can have on hand and in accounts on filing day.

Keep in mind that you don't have to keep the money saved from not making cc payments as cash. You can spend the cash to pay your lawyer's fee, and you can also spend the money to catch up on things that probably haven't been done for awhile - home and car repairs, healthcare, dental, stocking up on groceries, etc. As long as the expenses are legitimate living expenses and not extravagant, this is good pre-filing planning. Your lawyer can tell you what is acceptable to spend on and how much can be spent during the pre-filing period.

[fugazzi]

Thanks!

[momofthree]

In a chapter 13, ESPECIALLY if you're looking at a 100% payback plan, you can have non-exempt cash saved up without any issues. The laws require that your unsecured creditors get as much money as they would if you filed ch.7 and your assets were liquidated. So, if you had $15k in cash saved up that you couldn't exempt, you would simply have to pay your unsecured creditors at least $15k over the term of your plan (usually 60 months).

[fugazzi]

Yeah i'm thinking 100%, since 86K over 60 months is 1433.33, that leaves me with 4466.67 net for everything else, which my after my other bills is around 2500 for groceries/gas/etc...