341 Hearing part 2 today!

[Help!]

Back into the lion's cage we go, this time well-prepared thanks to the generous advice of many in this forum. If we've ever needed some luck (good luck, not the kind we've had) it's now. We'll update later - thanks to all for your support!

[Cali]

I am sending you lots of good luck vibes!!

[laurannm]

Good luck Help!

Keep us posted

[JRScott]

Good Luck Help

[Help!]

Thank you for the replies. UST still intends to file a motion to dismiss. For anyone questioning whether a one-time payment to you such as a bonus, relocation check, gift from a relative, etc. can be included as income on the means test.... oh yes, it most definitely can. I specifically asked our attorney why this amount wasn't included as income on the means test before we filed and he told me "It was a one time payment. It does not count as income." Nice, huh?

Where to go from here... we don't have enough income to support a Ch. 13 payment. We will not re-file Ch. 7 because we're still above median and would have to rebut presumption of abuse. So, we are back to square 1, trying to make minimum payments only now we're short the $2200 we paid our lawyer *and* we have no savings since we used the money we took out of a 401K to go buy two cars (more great advice from lawyer). And, finally, we have Ch. 7 on our credit reports for the next 10 years without having received any benefit of "bankruptcy protection". We'll do the best we can and pray we don't get sued.

To anyone who is considering filing Ch. 7 with an above median income, here are a few pointers:

1) WORK that means test to your advantage. Don't feel bad about it. The UST's job is to work the means test to your detriment - don't give them the ammo. Get your 6 month income as low as you possibly can while surviving. If you have medical bills, pay them in full instead of paying your unsecured creditors. Decrease your exemptions on your W4 and pay more in taxes. Contribute to a 401K. Make charitable contributions (up to 15% of your income). Time your filing so that the six months ending on the last day of the month before you file does not include overtime, bonuses, eBay proceeds, tax refunds, economic stimulus check, garage sales, etc.

2) Make your bank account histories look saint-like. Do not deposit anything other than your paycheck. Restrict checks/debits to groceries, gas, rent, utilities... only the necessities. For anything else, take out cash to keep on hand or use a Visa gift card which is not tied to your social security #.

3) Get the best attorney possible. If you can, sit in on some 341 hearings. Stand in the hallway and watch the attorneys. Some will be early, well-prepared, communicating with their clients about what to expect at the hearing and their case. Others will walk into the courtroom late, disheveled and casually drop some paperwork in front of their clients that they "forgot" the UST asked for two weeks before the hearing. *ahem*

4) Look for the attorneys representing the "no snag" Ch. 7's, the ones that are over and done with in 5 minutes. Avoid the attorneys whose clients are being interrogated for 15+ minutes about the mistakes the lawyer made in their petition. *ahem*

5) If you see some good attorneys in action, ask them for their business card or note their names. Once you have a few to look at, take a look at their open cases in PACER. If their below median Ch. 7's are taking 5 months, that's a sign they don't have their act together. If their above median Ch. 7's are all being dismissed for abuse or converted to Ch. 13, that is also a bad sign.

6) If you don't have 100% faith in the attorney you've chosen, you have doubts about them or they answer your questions with wishy-washy BS answers (like, "I don't see why the trustee would have a problem with private school tuition")... stop right where you are and get a better attorney!

I am actually okay with the outcome (it was what I expected), glad that we gave it our best shot and to tell you the truth... happy to have fought our last battle with the UST. One last thing... don't think for a second that the UST gives a damn about your circumstances. It's all about the numbers.

[laurannm]

Thank you for the replies. UST still intends to file a motion to dismiss. For anyone questioning whether a one-time payment to you such as a bonus, relocation check, gift from a relative, etc. can be included as income on the means test.... oh yes, it most definitely can. I specifically asked our attorney why this amount wasn't included as income on the means test before we filed and he told me "It was a one time payment. It does not count as income." Nice, huh?

Where to go from here... we don't have enough income to support a Ch. 13 payment. We will not re-file Ch. 7 because we're still above median and would have to rebut presumption of abuse. So, we are back to square 1, trying to make minimum payments only now we're short the $2200 we paid our lawyer *and* we have no savings since we used the money we took out of a 401K to go buy two cars (more great advice from lawyer). And, finally, we have Ch. 7 on our credit reports for the next 10 years without having received any benefit of "bankruptcy protection". We'll do the best we can and pray we don't get sued.

To anyone who is considering filing Ch. 7 with an above median income, here are a few pointers:

1) WORK that means test to your advantage. Don't feel bad about it. The UST's job is to work the means test to your detriment - don't give them the ammo. Get your 6 month income as low as you possibly can while surviving. If you have medical bills, pay them in full instead of paying your unsecured creditors. Decrease your exemptions on your W4 and pay more in taxes. Contribute to a 401K. Make charitable contributions (up to 15% of your income). Time your filing so that the six months ending on the last day of the month before you file does not include overtime, bonuses, eBay proceeds, tax refunds, economic stimulus check, garage sales, etc.

2) Make your bank account histories look saint-like. Do not deposit anything other than your paycheck. Restrict checks/debits to groceries, gas, rent, utilities... only the necessities. For anything else, take out cash to keep on hand or use a Visa gift card which is not tied to your social security #.

3) Get the best attorney possible. If you can, sit in on some 341 hearings. Stand in the hallway and watch the attorneys. Some will be early, well-prepared, communicating with their clients about what to expect at the hearing and their case. Others will walk into the courtroom late, disheveled and casually drop some paperwork in front of their clients that they "forgot" the UST asked for two weeks before the hearing. *ahem*

4) Look for the attorneys representing the "no snag" Ch. 7's, the ones that are over and done with in 5 minutes. Avoid the attorneys whose clients are being interrogated for 15+ minutes about the mistakes the lawyer made in their petition. *ahem*

5) If you see some good attorneys in action, ask them for their business card or note their names. Once you have a few to look at, take a look at their open cases in PACER. If their below median Ch. 7's are taking 5 months, that's a sign they don't have their act together. If their above median Ch. 7's are all being dismissed for abuse or converted to Ch. 13, that is also a bad sign.

6) If you don't have 100% faith in the attorney you've chosen, you have doubts about them or they answer your questions with wishy-washy BS answers (like, "I don't see why the trustee would have a problem with private school tuition")... stop right where you are and get a better attorney!

I am actually okay with the outcome (it was what I expected), glad that we gave it our best shot and to tell you the truth... happy to have fought our last battle with the UST. One last thing... don't think for a second that the UST gives a damn about your circumstances. It's all about the numbers.

Sorry to hear about this, Help....

Some thoughts:

1) Is it possible to lower\adjust your expenses enough to support a bare minimum Ch 13 payment (not even sure if that is allowed or how that works). Seems like tat

2) A couple of attorney's we met with gave us the same answer as far as cash gifts and the means test. And your right, it is definitely considered income (we too received a one time lump sum to help with expenses). However, as a "work-around" our lawyer has recommended that we include our parents as creditors, thus eliminating the need to include the lump-sum as income).

3) As far as bank statements go, I see your point about keeping them as clean as possible. But a lot depends on the situation...it sounded like your situation isn't necessarily the norm as far as the scrutiny on bank statements.

4) How much were you claiming as far as tuition goes on your means test?

In any event, I really feel for you and hope that things work out for you and your family.

[AngelinaCatHub]

Help: I’m very dismayed at your outcome and I expect similar. We are not above the means but my attorney did not (as she knew of it) put a Mortgage Deed we sold into our papers. She blames us, we blame her, and to date I have not heard anything for weeks although I DO NOT CALL, as I am getting a real hate for the person. I told her do email as I am making a paper trail. I have her email paper trail for her (intercourse up), and I shall throw her to the bus. I was told to make out a Bar complaint, send it to her, and tell her I will file it if she does not clean up our mess.

Please attempt to address your bad lawyer and tell him you hired a professional to do the job. After all, you would not take your own appendix out, right? So why not? You are not qualified. We are mushrooms when we started. Ignorant to a large degree as I never thought of this happening. HERE is where I learned most. Please attempt to appeal this. WHAT HAVE YOU TO LOSE??? ‘Hub

P.S. Stick around, you have helped me. Your job here is not over. Bless you.

[Help!]

Sorry to hear about this, Help....

Some thoughts:

1) Is it possible to lower\adjust your expenses enough to support a bare minimum Ch 13 payment (not even sure if that is allowed or how that works). Seems like tat

2) A couple of attorney's we met with gave us the same answer as far as cash gifts and the means test. And your right, it is definitely considered income (we too received a one time lump sum to help with expenses). However, as a "work-around" our lawyer has recommended that we include our parents as creditors, thus eliminating the need to include the lump-sum as income).

3) As far as bank statements go, I see your point about keeping them as clean as possible. But a lot depends on the situation...it sounded like your situation isn't necessarily the norm as far as the scrutiny on bank statements.

4) How much were you claiming as far as tuition goes on your means test?

In any event, I really feel for you and hope that things work out for you and your family.

1) No. Even without tuition, charitable contributions we are -$1200/mo. on schedule J because of medical expenses.

2) My lawyer included the same work-around. If the means test is anything but black and white, the UST has the power to turn any grey areas into anything they want.

3) Actually, every over-median income Ch. 7 in my district was required to provide 12 months of bank statements. It is the norm here.

4) Tuition came to $1000/mo. but this was not part of the basis for dismissal.

[Help!]

Thanks 'Hub. I will definitely be filing complaints with every organization I can as soon as our case is formally dismissed. Can't quite do that just yet because there's always the chance there's some negotiation taking place between the local trustee, the UST and the attorney. We have assets, we're willing to surrender them and we're hoping this is taken into account in any "negotiations" after the hearing. Of course, negotiations would require effort on our attorney's part. Laugh. So much for that idea.

I have my fingers crossed for you and ACat. Hang in there.

[laurannm]

1) No. Even without tuition, charitable contributions we are -$1200/mo. on schedule J because of medical expenses.

2) My lawyer included the same work-around. If the means test is anything but black and white, the UST has the power to turn any grey areas into anything they want.

3) Actually, every over-median income Ch. 7 in my district was required to provide 12 months of bank statements. It is the norm here.

4) Tuition came to $1000/mo. but this was not part of the basis for dismissal.

What exactly was their basis for dismissal...were they trying to say that you didn't pass the means test?

[AngelinaCatHub]

Mr. ‘Help’: Thank you, however, as much as you have aided me, I wish to return this favor. A suggestion, perhaps, draw a document in form of Court Paper, that you are releasing your Council for “irreconcilable differences and misfeasance in your ‘immediate’ case”. Then also state you are “Pro se” at this time, and wish to ask the Court for a reconsideration of a new hearing. Check the Court as to form. I am doing this and so far, with my AP it is going well. As I said before, what do you have to lose? Attempt to keep this file open rather than re-file. ‘Hub

[Help!]

We won't know what the basis for dismissal is until the UST files the official motion to dismiss (the deadline is Monday). We'll have to see what the grounds are for dismissal and then decide how to proceed. Based on what was said, it sounds like it will be dismissed because of the means test. We exercised stock options, cashed out our 401K and received a relocation reimbursement. All of this was counted against us as income, but there was no way to add in the expenses this money went to (e.g., moving expenses, rent, hotel, gas, etc.). This seems very unfair.

'Hub, I'll think about it. I worry that the almighty UST will dismiss us with prejudice if we object to the dismissal. Then we might not be able to discharge any of this debt in the future.

P.S. I'm a Mrs.

Funny how posts and emails give you an impression of a person...

[AngelinaCat]

P.S. I'm a Mrs.

Funny how posts and emails give you an impression of a person...

How right you are about posts and emails. I am 'Hub's wife, AC, and somehow all along I thought you were a lady. In fact, it seems like I addressed a post to 'Ms Help!'.....

I am likewise distressed to hear all your news. Perhaps it will turn out to be not quite as bad as you fear.

Our best wishes go to you~~~

[rfassett]

OK, Help! You stated that the UST does not give a wahoo about anything other than the numbers. You then state that you do not want to upset the apple cart because the UST might become vindictive. It will not be both ways. Case of point, unless you took "personal" shots at the UST, he/she has no ax to grind. It is strictly business and the law for him/her. I do not agree that non-income money always gets counted as income for the means test. I was able to show that I had used personal credit card advances to fund the operating expenses for my business. When I repaid the credit cards I did it by writing a business check to myself and depositing it in my personal account and then writing a personal check to the credit card company (the old "paper trail" routine). None of that money was treated as income on our means test. The UST tried, but I was able to show in detail, in black and white, what happened - and the UST accepted it, in the end. Such should be the case for your moving reimbursement. The stock options? I don't know any way around that. This is a classic example of "timing is everything". The 401k, well, that was just plain bad advice. So if you wait for those three things to be past the six month window, does that put you in the proper parameters? If so, most of that six months is past by now. If your current case gets dismissed, wait the requisite time to make it work and re-file "pro-se". You know the system now and you should be able to do that.

[danaf]

I'm sorry about your situation -

I can't believe they would want to include tax returns on the means when the means is the six month lookback and tax returns are an amount totaling a year period.

If your case gets dismissed, when is the soonest you can refile? Is it 6 months?