Help. I am so scared and confused.

[DeepBreaths]

My husband and I have filed for bk. we were told that we make too much $ and had to file 13. We haven't had out 341 meeting yet. It's in June. Our lawyer gave us a monthly payment of $776. I have been working a part-time 30 hour a week job. However, I have to cut my hours in half because we cannot afford child care in the summer while they are out of school. We have 3 kids. 11, 7 & 6. We're making our first payment this week and are scraping money to have enough for it. This is very, very scary. I don't know how we're going to be able to do it. When we first went to our lawyer we never thought we'd be in a ch13 situation. We've been struggling, counting coins, for years. Now that we've filed it still feels that we're counting coins, searching for grocery $. Is there any way to get our payment lowered or get into ch7? I mean, I am not sleeping, not eating, having panic attacks and heart racing episodes daily. I push myself to get out of bed for my kids to see a forced smile. Any help, comments would be so greatly appreciated. Any info you need in order to help in any way I will gladly give. I feel like a complete failure and don't want my kids to know how I have failed them.

Thanks in advance.

[spidge]

DB, I would say to relax, but you won't. I didn't when someone else told me too. Keep in mind that even though tough most Trustees want you to succeed so do research on every aspect of your situation to see where you can gain some wriggle room. You're in a 13, but your world is not ending. If you have been fighting for every penny you may find that the federal guidelines for many aspects of your budget are above your actual spending. This shows that you have been making an effort, but does nothing for your case. You can use these higher guidelines to establish your budget and your payment may be adjusted downward because of it. I know it sounds crazy, but consider a new or newer car to better insure you won't have any major auto repairs during your 13. I ignored this fact and am now dealing with the ramifications.

We are in our 31st month and have put more into my retirement and paid more toward the mortgage than ever before, so once you get used to your new budget life does go on and you will figure it out. By the way I had teenagers who were very understanding and grounded many of their friends who thought they had it tough. It could be a great lesson for the kids to gain understanding.

[keepsmiling]

Hey Deep, welcome to the fourm!
Did you not discuss the child care situation with your lawyer? Is your payment going to secured/unsecured debts? We need a little more info to comment intelligently on your case.
I'd tell you to PM me since I am in NJ too but you don't have enough posts yet.
I wish you had found us before you actually filed. Hopefully your lawyer is savvy enough to have crafted you a good plan.
If you want to tell us about income/expenses, we're pretty good at helping. It's a little bit late to talk about a new car now that you have filed.
OTOH-- it's only for a few months that it might be tight. Just the summer. Could be all will be well.

[dmc-2008]

Sorry you are so stressed, I hear ya. My kid is 14 and she doesnt know. This is not her problem and these days kids are so $$$$ oriented that I think knowing would be detrimental. I get it. You will figure it out, I am in month 7 and there have been some really close calls because this is a learning curve. But so far we are doing it, it's tight. My biggest fear is that my payment will go up someday and that would kill us. Just try to make sure you know what your payment will be for long term barring any windfalls or income increase that might jack it up.

[DeepBreaths]

Thanks for the responses. We are ok on the car issue, I think. We leased a 2012 Acadia and have a low payment on that. ($250/month). My husband has an old 2001 Toyota highlander that still runs like a champ and its only used for commuting. All of our debt in the bk is unsecured. It all started when we bought our house. It was a fixer upper...never again. Our income is 130k. We own our house and have a high mortgage payment. It's just under 3k per month. I was working full-time, retail management until just a few weeks ago. I lived at the store (my job). My kids suffered through school again this year because I was never home to help with homework/school activities, etc. We have no help with child care. So I am able to move down to a part time status at work and keep my pay...which is $10.50 an hour. I will get approx 15 hours a week. If we could afford summer camp, we would put them in it. But it's near 6k for all 3 kids. We emailed our atty 3 weeks ago with questions about whether we can get our payment lowered because of my work status, etc. We've had no response. Since I had to step down from my position they had to hire a full time person so I won't be able to go back I to a full time position in September, unless I look for something else. Of course I'd much rather be home a bit more to be with my kids but I am not opposed to working at all. We have our 341 meeting on June 13. Are we able to ask questions at this meeting? Are we able to discuss possibly lowering our payment? We track every single dollar we spend and it doesn't look good. I don't know how some people here who are in bk are putting $ into a savings acct as we literally have nothing left. I see some who go on vacation. We havent been on vacation in years. No weekends, nothing. Clothes for the kids are impossible even. We shop at Costco once a month. But honestly we cannot buy an extra anything and I am walking around with a calculator on a regular basis. How are we going to get through this? I'm sorry I'm not feeling very positive so any help, comments, support would help greatly!

[Pandora]

When you did your schedules - did you include everything you pay for in the year? Medical deductibles, dental, car insurance, car maintenance, etc etc etc.?

Its hard to know why your payment is so high if you're saying you have no $ and are barely getting by prior to filing Ch. 13 unless we have some background as to what you claimed for schedules.

[DeepBreaths]

My husband did all of the paperwork so I am sure he put everything into the schedules. When we were making the list of expenses for the lawyer I kept telling him to make them higher and he kept cutting them down. I'm sorry I can't give you more info because he's at work right now.

There is no way at all we can put any $ into a savings on the plan with the $776 per month payment. Is this normal not to be able to save?

[Pandora]

Chapter 13 isnt meant to be punitive - a good lawyer will ensure you're able to complete your Ch. 13 successfully. We've been in ours for 3 years and we've managed to still have vacations and put money away for emergencies as well as Christmas, birthdays, etc. It's all about budgeting.

It may be that you could not go any higher on your schedules due to your income level as IRS standards that come into play. You can find it here:

http://www.justice.gov/ust/eo/bapcpa/20130501/meanstesting.htm

A payment of $776 isnt bad for the income level you have actually, when we filed we we under median and qualified for a Ch. 7 but chose Ch. 13 due to wanting to keep paid off items (vehicles / RV) as well as strip our 2nd. Our payment is $600.

Given you filed together, it would be wise for you to know exactly what your husband filled out That way if you have questions or are asked for something from the Trustee or lawyer, you can provide it if hubby is working. Not to mention peace of mind that you will know how things work.

Just a warning - your payment is an estimate....it can go higher or lower after you have your 341. Ours was projected to be around $450 I think and it went up to $600 after our 341. Nothing is in stone until the trustee confirms your case. With that in mind, I'm hoping you talked to your lawyer about dropping your hours back and adjusting your schedules I & J to show a drop in income. If you didnt discuss that prior to doing it, call your lawyer immediately and get it taken care of so things can be adjusted accordingly (if you're able to do so).

[keepsmiling]

When you get the info- and you should- post the numbers here. Since you have no secured payments in your plan, could be there is room for adjustment. You aren't paying any cc minimums, right????

[DeepBreaths]

Were not paying any cc at all. Our lawyer told us to stop. I called the lawyer this morning with questions. The paralegal said he would go over any questions with us that day of our 341. I told her we wanted to meet with him. She said she could answer any questions that we have. My husband is going to call her back.

Pandora - when we made the list of expenses saving wasn't on the list. Should it have been? Every dollar we make goes to the budget with no room for anything. $776 payment, mortgage, house bills, food, clothes (3 kids, clothes are expensive so we struggle here a lot). Kids do one activity which is karate and this $390 per month. We have a 401k loan that is $500 per month.

I'm beginning to think we made a mistake and filed too quickly. But we didn't know what else to do. Now what?

[keepsmiling]

No, sadly, no allowance for savings. That has to come from padding the plan in other areas like groceries and clothing.
You will find ways to save, especially on clothing- that's probably the easiest place. Great thrifts abound. I find designer stuff regularly for 3 bucks. Learn to be creative, it will be a good tool to keep you out of bk'ing again

Going to go out on a limb here and assume that your monthly payment is less than you had been paying for cc minimums?

Also... your payment is not yet cast in stone. Still time to fiddle with it and get it close to perfect. Probably too late for a car tho. Someone will correct me on that if I am wrong.

[Pandora]

Hate to be the bearer of bad news, but that $390 a month for karate is probably not going to fly with your trustee. He / she will more than likely state its not a "necessity". We were allowed "entertainment" expenses to the tune of $60 for a family of 3. Like Keep stated, you CAN save money, you just have to pad your budget in other areas, like clothing.

You're allowed clothing expenses as well - I believe we were allowed $75 a month - so since we dont purchase clothes every month, we would set that money aside. If we had extra, we'd set it into a savings account or ER situation. You'll need to be sure you have $ set aside for ER situations - prime example was for us this morning. Nearly brand new tires on the truck and noticed one was cut yesterday; just had to plunk down almost $200 for a new tire, and that was prorated! Ugh. Clothing: Look for re-run shops like Once Upon a Child (they're pretty much nation wide) for your kids clothing and ALWAYS always check the clearance aisle FIRST. My sons clothing always is purchased off season; so right now I'll be purchasing all his winter clothing for this upcoming winter at discounts of 70-80% off; same thing come September / October - all his summer clothing for next year will be purchased. I get TONS of deals, and mostly brand names (like American Eagle, Gap, Aero) brand new for pennies on the dollar. for Christmas this past year I bought our son 15 T-shirts from American Eagle and 3 pairs of AE jeans for about $120. Talk about savings! I couldnt buy him gently used clothing for the price I purchased brand new for. ALWAYS look for promo codes as well - and compare shopping online to in-store. Most times I do it online only and get much better deals, and I never ever pay for shipping. There's always a code out there at some point.

There are many ways to save $ out of your budget, coupons are one thing that help us a ton. Learn to use them and you can look online at many sites that are free which will show all the best deals (many of them free when combined with coupon and sale prices). While COSTCO is great for bulk things, because its bulk purchases, many times you cannot use coupons. We have a SAMs Club and in the long run, its much cheaper for us to watch the sales papers and combine coupons, then stock up on what we use regularly that way vs. at SAMs. We do purchase things like TPaper, paper plates, and some other paper items from Sams as the savings are actually better for those things.

[Pjmax]

401K funding isn't considered a necessity by all trustees either (there was a poster recently about this.) that's $500 a month. If I had to choose, I'd put the 401k on hold and try to keep up with the kids' karate, but if you are struggling for food & necessities, $890 a month is quite a disposable option.

Also, I know you said your DH did the paperwork, but these are your finances and BK, with your signature, too. It's not a question of trusting hubby or not, you should have a voice in this process and setting up a reasonable budget.

[LadyInTheRed]

My husband is going to call her back.

Make sure your husband makes clear that your financial situation has changed since your filing due to a decrease in income and that he/you would like to talk to the attorney asap about amending the plan BEFORE the 341.

401K funding isn't considered a necessity by all trustees either (there was a poster recently about this.) that's $500 a month. If I had to choose, I'd put the 401k on hold and try to keep up with the kids' karate, but if you are struggling for food & necessities, $890 a month is quite a disposable option.

It's a 401K loan payment which is definitely allowed as an expense in a Chap 13. The Bankruptcy Code leaves no doubt on that point. As far as contributions to a 401k, the current law varies by circuit and even if the law says they aren't allowed, if a trustee or creditor doesn't object, a plan including a contribution could be confirmed.

Also, I know you said your DH did the paperwork, but these are your finances and BK, with your signature, too. It's not a question of trusting hubby or not, you should have a voice in this process and setting up a reasonable budget.

Well said. The petition is yours too and you are as responsible for the contents as your husband is.

[Pjmax]

Misread on the 401k. Sorry . . . Back to my nap now.