Can I file Chapter 7??

[woodj]

I am new to this group but have been doing some research about BK on the internet. A little bit of background. My wife and I both work and make a decent income. With our combined income, we barely live check to check. We have 40K unsecured and 70K secured debt. My wife developed a lung desease and as a result she cannot work. This occurred about two weeks ago. Now, we no longer make near enough to pay our bills. I have taken the on-line "means test" and qualify for chapter 7 when my wifes income is not included even though I am above the median. When her income is included I do not qualify. When I file, will I have to include my wifes income?

[danaf]

Welcome - but your post is confusing. First you say your wife works, then you say she doesn't, then you say she does. Well - which is it? Either she works or she doesn't.

Or are you trying to decide if she shouldn't work?

[Cali]

I read it this way, his wife doesn't work now because of her lung disease. But when she was working, their combined income was over median.

Welcome - but your post is confusing. First you say your wife works, then you say she doesn't, then you say she does. Well - which is it? Either she works or she doesn't.

Or are you trying to decide if she shouldn't work?

[TX Bluebonnet]

Sorry to hear about your wife's illness. My understanding is that you would need to include your wife's income that she recieved during the 6 full months prior to the month that you file, irregardless of whether or not she'll be working again. But the means test isn't necessarily the deciding factor on whether or not you'd qualify for a chapter 7.

[soleprop]

i think that if you're planning to file bankruptcy you should just take care of your wife and your needs, let the debt bills go for a couple months. i mean, if you're thinking bk anyway, just let some time pass between. it's obvious you two are working through a major health issue and life change. if ever there's a time, it's now. focus on taking care of your wife and your immediate needs. stop charging, and only pay the bills you absolutely have to to survive. no one can ask you to do more. time will show the effect of the loss of her income has on your ability to keep up with the debts you incurred when you both presumed you'd have incomes for the foreseeable future.

[JRScott]

If you delay the filing until after your wife has been unemployed for 6 months, then the look back will not show any income for her. The trustee might ask why she quit but they don't always, and you can just be honest and mention her health. It would give time to see what her medical expenses will be as well.

I'd stop paying on the unsecured debt if it is keeping you from meeting the necessary needs of life.

[woodj]

Sorry I sounded confusing. These are very confusing times for me. Cali nailed it on the head. My wife is not working now and I do not see her working in the near future. I am not behind on my bills YET but this has made a huge impact on our budget. Without her income, we are $2000 in the negative every month. It is only a matter of time before the wolves start calling. I went to a Lawyer to discuss my situation and found out I will have to include her income for the past six months. He also informed me that if I file chapter 13, I may qualify for a 'special circumstance" and a portion of my wifes income not be included. He said it may be possible that my chapter 13 monthly payment could be below $100. I am scheduled to take him all of my bills and 6 months pay stubs on Monday to do a complete evaluation. I felt like he was pushing the chapter 13 because I mentioned waiting 6 months to file. In 6 months I will have a better chance getting a chapter 7. The problem I have with the chapter 13 is that I may not end up with a positive budget even after bankruptcy. I think I will fend off the wolves for a while and hope I can qualify for chapter 7 at a later date.

[epiphany]

Sorry I sounded confusing. These are very confusing times for me. Cali nailed it on the head. My wife is not working now and I do not see her working in the near future. I am not behind on my bills YET but this has made a huge impact on our budget. Without her income, we are $2000 in the negative every month. It is only a matter of time before the wolves start calling. I went to a Lawyer to discuss my situation and found out I will have to include her income for the past six months. He also informed me that if I file chapter 13, I may qualify for a 'special circumstance" and a portion of my wifes income not be included. He said it may be possible that my chapter 13 monthly payment could be below $100. I am scheduled to take him all of my bills and 6 months pay stubs on Monday to do a complete evaluation. I felt like he was pushing the chapter 13 because I mentioned waiting 6 months to file. In 6 months I will have a better chance getting a chapter 7. The problem I have with the chapter 13 is that I may not end up with a positive budget even after bankruptcy. I think I will fend off the wolves for a while and hope I can qualify for chapter 7 at a later date.

I would wait until your wife has been unemployed for 6 months if you can. See if your lawyer will take the retainer now and then wait. And if he will, be sure to ask if he will field phone calls for you in the meantime. It helps to be able to tell creditors, should you choose to, that you are filing and to call your lawyer for more info.

Many here, including myself, have been dealing with not paying bills for six months or more. It is stressful yes, but it is more stressful trying to find the funds to cover all those bills. And it would be well worth it if it is going to make a difference between filing a 13 and a 7.

Be sure to pay your utilities, the rent if applicable, and any debt for secured items that you wish to keep.

Best of luck to you,
ep

[JRScott]

The important part in selecting a lawyer is to see 3-4. Some do try to pressure clients into 13s. If you are not behind yet on your bills you most likely can wait out the 6 months even if you stopped paying all the unsecured debt today. Your phone will get busy though (but just get an answering machine and let it answer).

I wish you the best.

[FreshLikeADaisy]

Woodj, I too believe you'd be better served by waiting 6 months to file, for multiple reasons. Not only will her income drop off, if you stop using credit now your chances of having to deal with a creditor objection in your Ch7 are greatly minimized.

It also occurred to me that, your wife having been newly diagnosed (?) you may accrue additional medical bills before you file that would be included in your bk. You may not even have to wait the full six months you're thinking of right now; it may be that your average income will drop below the median in less time. It doesn't have to drop off ALL the way, just enough to get you under the median, if it's clear she's not going to be able to return to work anytime soon. Obviously the longer you can wait the better, but if that's just not possible for whatever reason in the next few months, you still have the option of Ch7.

Basically, the advice you've been given here is sound: stop paying unsecured debt, or make only token payments if you feel you must, and use that extra cash to pay your bills and keep your head above water for the next few months. You may even wish to start going cash only. Use the time to research Ch7 and strategize as you learn about the process and what actually matters in a bk (which doesn't make a lot of sense outside the bk world, so prepare to be somewhat surprised) so that when you're closer to filing you can select a good attorney who is prepared to handle your Ch7.

Speaking of which, Chapter 13s are much more lucrative for an atty than a Chapter 7, so your feeling that you were getting steered into one at the atty's own preference is probably dead on.

Good luck to you and your wife!!! I hope it all turns out well and she feels better soon.