Preparing for Chapter 7

[leonel9]

I think this is probably more simple than the first attorney made it out to be. The conversation with other attorney(s) should help clarify these lingering questions. What I would consider, though, is that your discharge is not the same as the date your case is closed. You should receive a discharge shortly after the expiration of the deadline for filling objections to discharge, which is 60 days after your first scheduled 341 meeting.

My position (as a debtor, not a bankruptcy attorney) is that you time your filing so it does not interfere with your student loans, and exempt whatever you can. If you're expecting a bonus, perhaps you could factor it into your monthly income, as opposed to offering it to the trustee in 2018. If you still pass the means test and don't have a ton of disposable income, that may be a smarter way to approach the bonus. That way your discharge and closure date will be closer to the same date.

If you can't average out the bonus in your monthly income, then I wouldn't even bring it up with the trustee. You didn't get it last year and there's no guarantee you'll get it in 2018. Bankruptcy is meant to take a snapshot of your finances at the date of filing. If there is no guarantee of a bonus for work performed from Jan 1, 2017 to your filing date, then let the trustee decide this is something they want to explore.

Again, these are questions for your [other] attorney, as I am certainly not an attorney. Perhaps others will comment on their opinions of you offering to keep your case open until 2018 in case you get a bonus.

[Chrysalis]

Thanks again, leonel. Did not realize that discharge & closing are not at the same time / same thing.

If we file in July or August, his February bonus will be in the calculation -- and we still qualify.

I am going to make myself focus on my finals now, and I will start talking to that other attorney when I get those finished this week. Thanks again!

[Chrysalis]

I didn't want to get into any more loans anyway unless we absolutely had to, so I am now thinking a hardship withdrawal from 401k may just be the way to go to pay for fall. That would reduce our tax refund, as well.

The local attorney did respond again today and clarify that discharge & case closed are two different things. If we could be discharged by the end of the year, that opens up the possibility of a federal loan to pay for spring.

Discussions are still ongoing about back surgery. I am trying to get him to see that if he's going to do it, the time is here.

Also had a call with his pulmonologist today who insists on another CT scan to make sure he doesn't have lymphoma. Geez...

There is so much going on right now, I am sometimes amazed at how I am handling it all. And sometimes I wonder if I am on the verge of a mental breakdown. Lol. It's so nice to be here with others who have been through rough times & know that, somehow, it is going to turn out okay. Thanks again to all.

[LadyInTheRed]

Hi, Chrysalis,

There are many things I would like to comment on, but I am short on time right now. I haven't even read all of the responses. I will try to get back to this thread, but there are a couple of things I want to say.

I am a paralegal and work in post death estate administration. The fact that I work with the practical aspects of death along with my experience talking to the elderly (including my own mother) about their wishes for their loved ones they will leave behind, gives me a perspective grounded in reason, but also influenced by emotion. So, forgive my bluntness when I say that your grandmother knows she does not have a lot of time left on this earth. She can't take it with her! She would like to help you with your education. It would likely give her pleasure to see you benefit from the help she can give you while she is living instead of you benefiting after she is not here to see it. Accept her generous offer of help (I know you will show her your appreciation). Talk to your attorney about how she can help without risking the trustee taking back the money she pays. You mentioned her paying the school directly. Assuming your BK attorney says it's not a problem with the BK, paying the school directly for tuition will avoid her having to file gift tax returns which is required for gifts over $14K per year unless they are paid for medical expenses or tuition paid directly to the provider.

Also, as leonel9 said, you will not need to see your attorney in person more than once or twice. I only met my attorney during the initial consultation. I then went to his office to meet with his paralegal to review and sign my petition. All other communications have been by email and telephone. If it meant an hour drive, he could have emailed or mailed the petition to me to sign and mail back. Go with your gut and choose the attorney you know is the right one. I also have problems with the advise of the local attorney. He doesn't sound like someone who is going to be a strong advocate for you. I have more confidence that the other attorney will give you good advice about your education expenses, whether paid by your grandmother or with student loans.

[Chrysalis]

Lady, thanks as always for your response! I know everyone is busy. I'll look forward to hearing from you when I can.

I'm sure you're right on some level about my grandmother. She told me she always wanted to be a nurse, which I never knew before. She offered help if I needed it. But I know how my grandma has been in the past about the grandkids owing her money, and I've always wanted no part of it.

I borrowed $16,000 one time to pay off our 401k loan -- so that we could turn around and get a bigger 401k loan. I explained it all to her (how we were borrowing money from ourselves, and paying the interest back to ourselves) and she was fine with it. I had her $16,000 right back to her in about 2 weeks. I even offered for her to keep the money she gave me for my birthday as interest, but she declined.

When this conversation came up (knowing how she is) I said, "Well, grandma, I'd still have to pay you back at some point, so it would still be a loan..." and her response was, "Yeah, well, at least you wouldn't be having to take out a loan and pay their interest".

Seeing as she is 90 years old, and I know that other grandkids owe her money (and everyone hears about it when they don't pay for awhile), combined with the fact that I have my mother, aunt, and uncle (her kids) all still living who are "waiting" on her money -- it just feels strange. It feels like I would be taking it away from them. And then what if she dies? Do I pay THEM back? Ugh...

If it were worded 100% as a gift -- would be different. But it wasn't.

I'm not saying I won't still consider it. I just haven't wanted to go down that road.

Re: the attorney. My gut has been back and forth. I think you and leonel are right. But I will have to post more about that subject later. Thanks again!