On the wire for chapter 7 ?

[andy158]

Just left attorney's office this evening. Turned in our Credit Counseling Certificates. [Phase 1 complete]Went over the Means Test again and came in just $212.00 under the cut off. Schedule J, line 20 in the petition says I am ($1,695.00) minus/month. Just factoring our monthly expenses (without debt obligations) gives us only $360.00/month left over. Wife did not have any income this year until March. If we wait another month attorney says it can put us into chapter 13 according to income level. Are the Schedules I and J weighed in with the Means Test to qualify for chapter 7 when we are that close to the cap? He said the trustee will look at our case very close because of our income. I am worried about being forced into chapter 13 later in the proceedings. I am surrendering a boat and motorcycle with outstanding balances to show cooperation in lowering my debt. I am meeting with him next week to finalize our petition and he is going to push for filing before end of month. He has expressed his position on representing me in a chapter 13 and it is not good. I live in West Virginia if that makes a difference. INPUT PLEASE!!

[lrprn]

Are the Schedules I and J weighed in with the Means Test to qualify for chapter 7 when we are that close to the cap?

The key here is whether your local bk court weights the Means Test or the Schedules more heavily when determining disposable income. If your lawyer feels strongly that you need to file before the end of June, then he likely knows that in your local court, the Schedule I minus J likely has more weight. I would listen to what your lawyer says.

He said the trustee will look at our case very close because of our income.

What is your income compared to WV's median income for your family size?

I am surrendering a boat and motorcycle with outstanding balances to show cooperation in lowering my debt.

Understand that when you file Ch 7, the court and your trustee don't care about your cooperation. Filing bankruptcy is a by-the-book process. Your exemptions and the local court's customs and practices determine what you can keep and what you can't. There's no emotion involved at all.

He has expressed his position on representing me in a chapter 13 and it is not good.

What did your lawyer say?

[justbroke]

Are you surrendering all of your secured debt? If so, this is probably what's give you that $300+ disposable income. That would certainly tend to push you into a Chapter 13. Also, if your wife's income is just starting to factor in (she started working less than 6 months before filing), then that could be a factor too as your "average" income goes up.

Are you saying that you're under median? If you are under-the-median, your Schedule I and J are what is used (since you don't do the whole Means Test). They will be looked at more closely, especially around property (secured property) that you are surrendering.

[andy158]

My income is slightly higher than WV's median income for a family of four ($59,300)
WV median income for a family of four is $57,552___________________________________________ _____________________________

Atttorney says he doesn't have the time to represent me in a chapter 13 due to his case load due to our local ecomony. Two steel mills and several car dealers have closed and the unemployment rate here is about 15%. He has new appointments daily.

[andy158]

Are you surrendering all of your secured debt? If so, this is probably what's give you that $300+ disposable income. That would certainly tend to push you into a Chapter 13. Also, if your wife's income is just starting to factor in (she started working less than 6 months before filing), then that could be a factor too as your "average" income goes up.

Are you saying that you're under median? If you are under-the-median, your Schedule I and J are what is used (since you don't do the whole Means Test). They will be looked at more closely, especially around property (secured property) that you are surrendering.

Keeping house and two vehicles and one installment loan for furniture. The boat and motorcycle surrendering frees up and additional $345/month.

[justbroke]

I'm going to be candid and say that you are probably going to get pushback from the U.S. Trustee. You didn't mention how much unsecured debt you are attemtping to discharge.

Also, you are over the median, and I don't understand what secured debt payments you have. If you actually have $300+ of disposable income after you no longer need to pay for the boat and car (and house???)... then you will more than likely be pushed into a Chapter 13.

Sounds like your lawyer is almost reserved to that, as a fact.

[andy158]

Trying to discharge $100,000 + unsecured debt. Mostly medical bills and about $20,000 in credit cards.

Secured debt payments total $2,800/month.

[justbroke]

Trying to discharge $100,000 + unsecured debt. Mostly medical bills and about $20,000 in credit cards.

Secured debt payments total $2,800/month.

Okay, it is over $100K, but it's mostly medical. Looks a little better.