Up the Famous Creek With No Paddle (Need Advice Please)

[brokemomma]

My husband and I just found out we don't qualify for a 7 under the means test. Our lawyer also told us we really don't have enough to complete a 13. What do we do now? Our lawyer told us that a trustee is going to require us to pay at least 1,000 per month. There is no way we can do that? We have 87,000 in unsecured debt so we have to something soon. What are some alternatives to bankruptcy. This is a sad sad situation. We are broke, but we can't even file bankruptcy. I thought in a 13 the trustee looked at expenses and tried to make the payment reasonable but maybe their is a minimum payment. I don't know. Any advice or comfort would be really welcome.

[Pandora]

I went back and read some of your posts to better understand the situation and it appears that you / spouse are 2X's the median income, so based on a quick glimpse, it would appear to be a Ch. 13. With that being said, some lawyers see income and automatically say "no Ch 7 for you.. above median income", which isnt true. You can be above median and still file CH. 7, it all depends on your DMI. Have you done the means test yourself? Schedules?

Debt limits are $1,081,500 for secured debt, and $360,525 in secured debt as of April 2010. Are there assets you're wanting to keep? Any assets you cannot exempt and want to keep, you must pay back into your Ch. 13 plan (Ch. 7 liquidation test). As to the $1K proposed Ch. 13 payment - what do you currently pay out to your creditors monthly? Example: if you currently pay $2K towards credit cards, cars, loans - and your Ch. 13 plan is $1K, basically you're saving $1K. You really need to do the means test / schedules yourself to ensure everything is counted correctly. Since you are over median, you will have to use the IRS standards for some things, while others you will get the actual $ amount you pay.

[tobee43]

i would go see another atty.

we had over half of the atty's we interviewed tell us we were a chapter 13.

we did an no asset 7 with no problems. i would get a few more opinions, each atty may have a different view. also re- go over your expenses...how much over were you on your means test????

[tobee43]

ahhhhh pandora!! yes, just the one! LOL!!! sorry, i was writing at the same time.

brokemamma, i would really review pandora's advise as she has been following your situation carefully and always has excellent input!!!

best of luck to you!