Newbie needs help

[uptomyears]

I'm so glad I found this board. You've all been so helpful and I feel like you're all friends. I can sleep better tonight knowing that if I have questions and I'm sure there will be lots, I can come here and someone will help me sort through this. Thank you!

[Tbornetun]

Then you are good to go.

You were talking about your husband wanting to do a Ch 13 plan, without having any disposable income, he may have a hard time getting a plan approved. Talk to him, if you are going to file a Ch7 and you have enough exemptions to cover his equity in the home, have him file with you. Start fresh and get on with your life.

[BnkrptcyLwyr]

Yes, that simple. You just want to make sure that your schedule J doesn't show that you have a bunch of extra money every month.

Correct. THE MEANS TEST IS NOT THE END OF THE STORY.

That's why I did some "basic" numbers that I typically see for a household of 2. And the fact that there are no car payments probably means that (if they didn't have the credit card debt or other debts to worry about) that they very likely have some extra money.

Of course, this is based on what I "typically" see for a household of 2. There might be large medical expenses, or something else in their situation like high utilities, etc.

I obviously can't say without knowing their exact spending on expenses ... but as I said, there are strategies for fixing that potential Schedule I/J problem.

[uptomyears]

No, he's not wanting a do a Chapter 13 or be involved at all at this point. That was my idea. Maybe after we go see the attorney he can advise us what would be best. The house is the most important thing to protect. I'll even go get a job to boost the income if necessary. Anyone hiring?
McDonalds?

[BnkrptcyLwyr]

Then you are good to go.

You were talking about your husband wanting to do a Ch 13 plan, without having any disposable income, he may have a hard time getting a plan approved. Talk to him, if you are going to file a Ch7 and you have enough exemptions to cover his equity in the home, have him file with you. Start fresh and get on with your life.

Our firm always tries to get people in Chapter 7 if we can. You do NOT need to do a 13 to save your house. Chapter 7 can work just fine. Especially nowadays with the mortgage companies BEGGING people to stay in their homes (at least here in Michigan) and in some cases volunteering to reduce interest rates AND PRINCIPAL!

[uptomyears]

BnkrptcyLwyr, not filing jointly, can we not include his monthly cc payments as monthly debt? Just basic monthly expenditures mortgage, utilities, home and auto insurance, real estate taxes etc. plus his cc payments add up to about 2600. out of the 3100 net income.

[Tbornetun]

That's what I meant. We also always try to put people in a Ch 7 whenever possible. We have beat the means test until it is bloody, but have received a Ch 7 discharge. She has stated in an earlier post that her husband would probably want to go the 13 route. That is why I was trying to convince her to talk to him. The husband wants nothing to do with it right now. It has nothing to do with their house, they only owe $30k on it.

Uptomyears - Meet with more than one attorney. Have a free consult with at least 2-3 minimal. Choose the one you feel most comfortable with.

[BnkrptcyLwyr]

BnkrptcyLwyr, not filing jointly, can we not include his monthly cc payments as monthly debt? Just basic monthly expenditures mortgage, utilities, home and auto insurance, real estate taxes etc. plus his cc payments add up to about 2600. out of the 3100 net income.

Yes, you can take out the credit card payments that he makes which do not go to the support of you (that reminds me). But, if all of your regular and necessary expenses add up to $2600 out of $3100 net income ... that means ACTUAL disposable income of $500. You need to get that number below around $120.00 (and the closer to break even - $0 - the better.)

As I said, a new car payment wouldn't hurt! And there are other things you could try too.

[uptomyears]

what about groceries and doctor co pays and monthly meds is there an allowance for that?

[Tbornetun]

Absolutly, that will easily eat up the $500 BKLawyer is talking about. You can find a copy of schedule J online. Google it. Fill it out and see where your numbers fall.

EDIT: Here is a link to schedule J http://www.uscourts.gov/rules/BK_For...006J_1207f.pdf

[BnkrptcyLwyr]

That's what I meant. We also always try to put people in a Ch 7 whenever possible. We have beat the means test until it is bloody, but have received a Ch 7 discharge. She has stated in an earlier post that her husband would probably want to go the 13 route. That is why I was trying to convince her to talk to him. The husband wants nothing to do with it right now. It has nothing to do with their house, they only owe $30k on it.

Uptomyears - Meet with more than one attorney. Have a free consult with at least 2-3 minimal. Choose the one you feel most comfortable with.

I agree ... why file a 13 if you don't have to! Just file a 7 on both if possible.

We have a great win on a case where one spouse filed after receiving a 20% decrease in income, and the other non-filing wife spouse was maintaining a $750 payment on a condo which she kept after they got married and which we deducted as a "special circumstance" on the means test and deducted on J.

Of course, UST motion to dismiss - claiming that there was no reason for the wife to keep the house and that if she got rid of the house they could pay in a Ch13. We won! I was kinda shocked ... but we still won. UST was floored.

[BnkrptcyLwyr]

what about groceries and doctor co pays and monthly meds is there an allowance for that?

If those were not included in the $2600 ... I can say with a VERY HIGH DEGREE OF CONFIDENCE ... that you will be fine.

When you do the analysis ... take out your husband's credit card payments ... if you're about break-even, then you should both file 7 and just get rid of all the debt.

Believe me ... credit scores/worthiness is not that hard to get back up there ... even after bankruptcy.

[uptomyears]

I'm looking at these numbers in astonishment. I have no idea how we've been able to stay current with all our bills and debts all this time and still eat. I know that before the end of the month there is nothing left over and we certainly don't spend anything on ourselves. Of course when all the cc rates jumped so did the minimums. All of my personal cards were picking up the slack in the business. And I used business funds to pay those cards. I really started to get in trouble in Aug. when sales badly declined and now they have virtually tanked. Hence the decision to close the doors. I'll check out that schedule J and see where we are.

[uptomyears]

Is this for gross income or net. I used gross Schedule J doesn't have a space for fed. withholding or medical insurance withheld from the pension or husbands cc debt. I added it all in. We are about break even. I didn't even take some of the deductions as we don't usually have any monthly recreational funds.

[hereforinfo]

I bet if you added it all up, over the years your husband has paid back all or more of the original amounts he actually charged on those cards long ago. Perhaps that would encourage him to file with you and get that fresh start.