Under the means, but..........

[Migal]

How often does it happen that a person is under the means for a 7 but can't do a 7?

[MSbklawyer]

Can't do a 7 -- why?

[Migal]

My attorney told me that we have to make sure there is still no disposable income. I've read about that on here. I just wondered what the odds were of that happening.

[MSbklawyer]

My attorney told me that we have to make sure there is still no disposable income. I've read about that on here. I just wondered what the odds were of that happening.

I'm assuming that by disposable income, you mean money left over on I minus J?

I'm not sure about Cali., but our circuit that's still an unsettled issue. It rarely happens though unless the debtor is a social security recipient. Social Security is not counted as income on the means test, but it is counted as income on Schedule I.

[Migal]

I'm in Michigan. I haven't saved receipts for everyday things either. Gosh, there is always something to worry about.

[MSbklawyer]

I'm in Michigan. I haven't saved receipts for everyday things either. Gosh, there is always something to worry about.

Here, at least, nobody expects you to have saved receipts for everyday things. If your expenses listed on Schedule J are reasonable, the trustee and court generally accept them without question. I don't know where I got the idea you were in Cali.

But you're right. There IS always something to worry about. That's why you pay the lawyer. To worry for you.

[music12]

i don't think it's a question of likelihood but rather of numbers. it seems strange that a person making less than the mean would be able to keep expenses so low that they would have disposable income. if they do, they are probably entitled to increase them for the few months before filing so they do qualify. say, if someone is living rent free with relatives, they should start paying rent to their relatives.

[LuciluS]

What's your disposable income? Could you hold off on filing so you might be able to raise your expenses?

Even though it was tough when Hubby and I felt the crunch last Sept., I did not reduce any of our expenses like unlimited long distance, high speed internet & kept the same package deal on Satellite TV. Did not reduce our cell phone coverage. Kept our bi-monthly pest control policy & alarm system as hubby is an over the road truck driver.

Because of our health issues, unable to get any life insurance; however, was able to get Decreasing Accidential Death Insurance on our Mortgage & a $500,000 Accidential Death Policy of hubby.

Go through your last 12 months bank statements to make sure you've listed all your expenses. If the Attorney gave you a print out of your expenses, look them over with great detail.

[Migal]

I haven't actually filled out I and J yet. I just wondered what were the odds of it happening.

I will just have to see what happens I guess. We're just a normal couple with normal expenses, except for my cc debt.

Time will tell

I was just hoping to be told, don't worry about it, chances are slim that you won't make it if you're under the means anyway.

[LuciluS]

I haven't actually filled out I and J yet. I just wondered what were the odds of it happening.

I will just have to see what happens I guess. We're just a normal couple with normal expenses, except for my cc debt.

Time will tell

I was just hoping to be told, don't worry about it, chances are slim that you won't make it if you're under the means anyway.

Did you consult with more than one Attorney? Do you feel 'comfortable' with this Attorney? There are lots of them who will give free consultations.

FYI - An Attorney makes more on a Chapter 13 than a Chapter 7. I believe your disposable income needs to be less than $165 or $166 before having to file a Chapter 13.

[Migal]

This guy has been recommended to me by an accredited credit counselor and also a couple other attorneys. I did talk to a couple others also.

I really think that he is just playing the devils advocate a bit.

[LuciluS]

This guy has been recommended to me by an accredited credit counselor and also a couple other attorneys. I did talk to a couple others also.

I really think that he is just playing the devils advocate a bit.

Ok. Now it's time to start researching your bank statements for the last 12 mths. I have spreadsheet Galore for our BK which will be filed 9/30/09.

Good Luck

[justplaintired]

Try to worry too much about this. You attorney knows what the expenses need to be and what things you might not think about as being an expenses. I drove myself nuts trying to get the expense thing where it needed to be. I had stacks of receipts, figured and refigured. I called our paralegal and she was able to help me. She gave me ideas on acceptable expenses. You are allowed expenses you probably haven't even thought of. Your attorney will be there to help get things right and if your attorney isn't making you comfortable now, then you probably need to talk to a few more.

[Moneypenny]

sorry dont want to derail this, but on a related note: i have the same question but if your income is already below the median, without doing the extra schedule thing, is there any reason that you will need to justify all the withdrawals that show up in your bank statements? what if you bought a few things that are not necessities and possibly expensive, with cash, 7-8 months before filing?

[LuciluS]

sorry dont want to derail this, but on a related note: i have the same question but if your income is already below the median, without doing the extra schedule thing, is there any reason that you will need to justify all the withdrawals that show up in your bank statements? what if you bought a few things that are not necessities and possibly expensive, with cash, 7-8 months before filing?

Sounds like to me the purchases could probably be Assets/Personal Property. Just list them and use garage sale prices. Remember, the minute you buy something new it depreciates.

My dh makes a $100 withdrawal every week to use out on the road. He is an long haul over the road trucker driver. I don't think the Trustee will question any withdrawals under $400.

Most of the time, all the Trustee wants is a Snapshot of your Bank Account on the Day You Filed Your Bankruptcy Petition. Sometimes, an Attorney may ask for them, but usually it is 6 months worth. Our Attorney wants 2 months bank statements.

Luci

PS If it purchases were for a vacation and you are questioned, I would say didn't know at the time of vacation we would be filing BK