"Is unemployment income used in calculating total income for a chapter 7

[LaidOff53]

Hi,
after 24 yrs of employment with the same employer my husband was laid off 4 months ago , We have credit card debt of $44,000 & our mortgage payment , which are all current and we have never been late on anything. since my husband's lay off we have only been making the mins on our CC's because his unemployment checks total less than half of what his pay was per month.
Well the blood sucking credit card companies have all raised our interest rates from around 12% to 28% and lowered our amount of credit available to the amount we owe on each card ( we have 9 ) which i cant believe they would do to us having NEVER been late on any of them,
We can not continue to make The credit card payments for much longer so we are looking into a chapter 7 bankruptcy . My question is When figuring the amount of income we both have made in the last 6 months do we have to include his unemployment as income ? ( we live in Pennsylvania ) and we can only make $51,000 for the yr to be able to file a 7 , my income & his unemployment will put us over that if we have to claim his. also , We want to keep our house , Since we have never been late on any of the payments do we have to include the house in the chapter 7 ? We know that this is the last house we will own as my husband is 53 and jobless and the bankruptcy will be on our credit report for 10 years and who will give a 63 yr old a 30 yr mortgage???? and lastly do we HAVE to reaffirm our mortgage ? and if we do can our mortgage co ( Citimortgage ) refuse to reaffirm our loan because now we wont have my husbands income , and can they change the terms of the original mortgage like the interest rate ect...?????
sorry for so many questions at once but i am totally stressing out about all of this , at this stage of our life we never thought our lives would be turned upside down !!!
thanks in advance !

[dingdong]

Just a little plug of hope for you. My mom at 72 bought a house with a mortgage that will most likely outlive her.

I don't think you can discriminate credit wise based on age.

Pretty sure that is a No No!

[TEW]

Hi,
after 24 yrs of employment with the same employer my husband was laid off 4 months ago , We have credit card debt of $44,000 & our mortgage payment , which are all current and we have never been late on anything. since my husband's lay off we have only been making the mins on our CC's because his unemployment checks total less than half of what his pay was per month.
Well the blood sucking credit card companies have all raised our interest rates from around 12% to 28% and lowered our amount of credit available to the amount we owe on each card ( we have 9 ) which i cant believe they would do to us having NEVER been late on any of them,
We can not continue to make The credit card payments for much longer so we are looking into a chapter 7 bankruptcy . My question is When figuring the amount of income we both have made in the last 6 months do we have to include his unemployment as income ? ( we live in Pennsylvania ) and we can only make $51,000 for the yr to be able to file a 7 , my income & his unemployment will put us over that if we have to claim his. also , We want to keep our house , Since we have never been late on any of the payments do we have to include the house in the chapter 7 ? We know that this is the last house we will own as my husband is 53 and jobless and the bankruptcy will be on our credit report for 10 years and who will give a 63 yr old a 30 yr mortgage???? and lastly do we HAVE to reaffirm our mortgage ? and if we do can our mortgage co ( Citimortgage ) refuse to reaffirm our loan because now we wont have my husbands income , and can they change the terms of the original mortgage like the interest rate ect...?????
sorry for so many questions at once but i am totally stressing out about all of this , at this stage of our life we never thought our lives would be turned upside down !!!
thanks in advance !

Yes you include all sources of income. If you were late even an hour on a CC there is a universal default clause on the CC agreement and they can and will raise your interest rate. I know how you feel I will be 65 when the BK comes off my record. you don't have to reaf your mortgage in fact it's a good idea not to. just keep pay and you can keep the house.
I filed in PA also.

[StartingOver08]

TEW I have been reading on other boards that the cc's are increasing the interest rate because of 'the general economy' to you don't even have to be late - not even an hour to experience the high interest rate increases. As to the credit line reductions, the cc's are reducing you to just above your outstanding balance and then, because you now have high utilization, they increase your rate to the maximum permissable rate!

As to changing the terms of your mortgage - NO the lender can NOT change the terms. They can however force a higher rate of interest ONLY if you default on the payment. The mortgage is very, very specific (thank goodness) so as long as you keep making your payments on time, you will be fine even if you do not sign a reaffirmation.

Dingdong is right - they can not discriminate against you because of your age, so if you ultimately ended up getting another 30 yr mortgage ten years from now they can not use age as a factor to issue it or not.

[Trixie007]

The lender can't change the original terms of your note just because you file BK. I don't know why someone else here says they can force a higher interest rate on you if you default on a payment, but that would only be true if that is in your original agreement.

[LaidOff53]

thanks,
Living in Pa is it true that i can file under the State OR Federal Bankruptcy rules ? I found a site online that said that If i file under the Federal our unemployment income is NOT counted towards our monthy income ( although i know we have to list it ) , but if we use the State rules our unemployment WILL count as income , If it does not count we can file tomrrow , But if it is counted as income we will be above the $51,000 per yr theshold to file a chapter 7 , I took a sample means test online and if the unemployment is counted we will have to go chapter 13 ( which we do not want to do ) My husband gets the max on unemployment per month
( $539.00 ) and with my income we would be over by like $2,000 per year to file a 7 . sorry if im rambling , My mind is going a mile a minute trying to figure out whats the best way to go about all of this .

[LaidOff53]

Opps i meant to say that my husband gets $539 per week not month

[deadbroke99]

Wow, unemployment in SC is a max of $260 a week or something close to it so that's not too bad. Did you take into account your secured debts. You can be over median and still be able to file ch 7 if you pass the rest of the means test. Good Luck to you. I hope your able to do it.

[LaidOff53]

Hi broke,
yes , Pa unemployment max per week is very good compared to other states that i have seen , but it WILL end and there are NO jobs in our area so we know that something will have to go unpaid and that has to be the credit cards , so we are trying to keep the house and Bankruptcy seems to be the only option . after 24 years at the same company we thought that my husbands job was safe , but seems NOTHING is safe , all i know is that we are hanging on by our finger nails trying to pay everything , Im tired of sitting up all night with pen & paper trying to make everything work when i know its a losing battle , and the credit cards keep rising for no reason what-so-ever !! I feel like im drowning !!! and it would just be our luck that we make to much on unemployment to file for a chapter 7 !!! :-(

[StartingOver08]

The lender can't change the original terms of your note just because you file BK. I don't know why someone else here says they can force a higher interest rate on you if you default on a payment, but that would only be true if that is in your original agreement.

That's exactly what I said - its in the original mortgage everyone signs. You have a payment due as long as you pay it on time you have the same payment. Check the default clause on your note and mortgage - it will tell you what happens when you default.

To the OP, you were saying you are on time - so the default interest rate does not apply to you

[deadbroke99]

Yes just pay your mortgage, food and cars and don't worry about the credit cards. There is no debtor's prison. You must have a place to live, eat and a way to get around. If you can't afford to keep the house, then look to rent something cheaper. Some people make the mistake of paying credit cards before mortgage or car payments.

[keepmine]

Just because you're over the median does not mean you can't get a Chapter 7 discharged. It all depends on the disposable income you show.
Most bk lawyers give free or lowcost initial consultations. Go see a few and see what they say.

[catleg]

If you send another penny to those credit cards it's just like putting money in a shredder.

In a couple of months your average income will come down enough for the ch7. In the meantime you start your planning and studying. The worst mistake people make is filing too quickly just to make the phone calls stop.