New Here with questions about Ch13 Payment...

[buffetbuster]

I've been lurking around here for some time now reading posts and didn't exactly find an answer to my questions, so I'm gonna ask and see if someone can help...

We are meeting with our Lawyer at the end of the week to do credit councelling. He said it was going to be 3 hours long, ugg! Anyway, we have all of our paperwork done and are going to submit it to him. We are going to push for a chapter 7 depending on how the means test goes.

I filled out my monthly worksheet and it seems as though our monthly expenses are close to if not exceeding our monthly salary. Does that automatically put us in a chapter 7? If we don't get into a chapter 7 and do have to file Chapter 13, how is the monthly payment determined? Will we be so strapped for cash that we won't be able to have a social life? We have a young daughter and would like to still take her places, get her things and stuff like that...

Anyone with experience or would like to share their Chapter 13 payment with me would be greatly appreciated.

Thanks in advance!

[lrprn]

I filled out my monthly worksheet and it seems as though our monthly expenses are close to if not exceeding our monthly salary. Does that automatically put us in a chapter 7?

Your personal calculation of income vs. expenses doesn't matter. What matters is whether your mandatory Means Test and (if necessary) Schedules calculations show sufficient disposable income to support a Ch 13 plan or not. There's a great deal of variability between trustees and local courts about expenses - that means having a knowledgeable and experienced dedicated bk lawyer calculate your Means Test can make a huge difference in how the calculations come out.

If we don't get into a chapter 7 and do have to file Chapter 13, how is the monthly payment determined?

Whatever your disposable income is calculated when completing the Means Test and Schedules = your monthly Ch 13 payment. You need a minimum of around $150/month or so to support a Ch 13 plan. Anything under that usually means you can file Ch 7. But remember - there's variability between trustees and local courts about how much "wiggle room" there is when completing the Means Test.

Will we be so strapped for cash that we won't be able to have a social life?

You are also allowed to include a modest amount of money per month for entertainment when your Ch 13 expenses are calculated. Even more important, if you hire an experienced bk lawyer that files a lot of 13s, chances are you'll have a plan payment you can live with for five years. If you are very careful with how you spend your money, you can slowly build up an emergency fund and still have even more dollars left over for a modest social life.

Anyone .... would like to share their Chapter 13 payment with me would be greatly appreciated.

Sharing anyone else's monthly payment with you will tell you nothing about what would happen if you have to file Ch 13. Your income, assets, secured loan payments, and living expenses are unique to you. Add that to the differences between what some trustees allow for expenses on the Means Test - two people with the same income can have very different Ch 13 payments.

Some advice.....start by setting up at least 3-4 free initial consultations with experienced bankruptcy lawyers in your area. Add together the last six months of income from all sources, all your debts, and estimate your living expenses over the last six months as well. Take these with you to the free consultations. Keep in mind that the best bk lawyers are often not the cheapest or the most expensive.

To pick a good bk attorney means *you* have to educate yourself about both Ch 7 and Ch 13 and how each one works before meeting with anyone. Here are some reliable online sources to read about each:
Chapter 7 - http://www.uscourts.gov/FederalCourt.../Chapter7.aspx
Chapter 13 - http://www.uscourts.gov/FederalCourt...Chapter13.aspx
Differences between Ch 7 and 13 - http://www.mroselaw.com/CM/Custom/Ch...Comparison.asp

Also there are two excellent NOLO books that are well worth the purchase:
How to File for Ch 7 Bankruptcy - http://www.nolo.com/products/how-to-...uptcy-HFB.html
Chapter 13 Bankruptcy - http://www.nolo.com/products/chapter...uptcy-CHB.html
Both books are available on Amazon as well as at the NOLO website.

Happy researching and good luck! Please keep asking questions - we'll help you sort things out as best we can.