To file or not to file?

[jlasky]

I am currently in bankruptcy (chapter 7) since 07, should be clear next year. We are married and live in MO. We have 67,000 in car debt, 65,000 in primary mortgage debt and a second mortgage of 17,000, 70,000 in installment loans (prosper, lending club, etc) and about 30,000 in credit card debt, 60,000 in student loan debt (doesn't count). We have about 45k in 401k. Our income combined is around 160,000 a year. We have expenses, like anyone, car insurance is the highest expense 370.00. Our checking account is at the same bank as our first mortgage. Unfortunately this has happened again. I am very upset and I guess things happen. Would we be eligible for a chapter 7 again? With the installment loans, they take the money out of our checking account, if we do file how do we avoid it without it being illegal? Putting the debt on paper is very overwhelming. The only big equity we have is our home, paid half of it off, however we still have that second mortgage too. Let me know if you need additional information.

Thanks!

[justbroke]

It's too difficult to determine whether you would be "eligible" to file Chapter 7 at this time. It is really about your income versus your allowed expenses. Once your "disposable monthly income" (DMI) is determined, then you can figure out whether you "qualify" for a Chapter 7.

VERY GENERALLY SPEAKING, it can be difficult to file a Chapter 7 with income above the median income. Your income would be above the median for any State. So, you would need "allowable" expenses that would create a situation where you had no DMI. It's difficult, but can be done since I earn a similar income and received a Chapter 7 discharge (mortgage payment near $5,000/month). (The installments loans, upon you filing, would be REQUIRED to stop drafting your checking account.)

You have many moving parts and it's probably best to obtain several free consultations. I'm concerned that you may actually have a LOT of DMI because it appears that most of your debt is "unsecured" credit card and personal loan debt.

[jlasky]

I probably have a lot of DMI, so it probably makes more sense just stick with the payments for 4 years to pay off everything rather than filing chapter 13. I just hate building a hole and I just have to be patient to dig out of it.

[jlasky]

Question if I do file for a Chapter 13, lending club, prosper are peer to peer lenders, would they drop the loan or would I have to pay it back? The real question is how do the people that invested in my loan get their money?