Do I qualify for Ch. 7 in your opinion?

[BCA2009]

Wow, I'm not trying to get with an argument with anybody here, but several posts seem to be pretty judgemental. For the most part on this forum everyone is very supportive of each other. This poster asked if he may qualify for Chap 7, not does anyone think he should try to work out a plan.
Hell, lots of people MIGHT be able to work out a plan, but most on this forum are asking questions (and getting good advice) on ways to get their means test to pass. And good advice is given on how to maximize allowable expenses.

Deciding whether or not to file is a different question from "Do I qualify?"

Part of BK planning is getting your ducks in row before you file (once you have decided to file). I have read a number of posts where people purchased dependable vehicles before they filed because they knew they wouldn't have good credit for a long time.

And $800 a month is a very reasonable house payment (or rent payment).

30K of unsecured CC debt, with a interest rate of 24% would yield monthly payments of just interest in the amount of $625 a month.

So to actually answer the poster's question:

$2000 a month in income is going to be way lower than the medium income in GA (I just picked Athens which is $3391 a month.

FICA/Medicare would be $153 amonth, Lets just say $100 per month in Fed Tax. I have no idea what state tax is or if the poster has insurance deducted.

Stardard Allowances in GA for family of 1 =

Food Household = 517
Medical = 60
utilities = 367
Mortgage = 800 (stardard = 719, so not abusive)
Vehicle expenses = 201
Vehicle payment = 489
Health care = 60
Taxes = 253
Chap 13 plan payment = 60

This would yield a Negative DMI of $747.

Even if some of the items were lowered he should easily pass the means test without presumption of abuse.

I suspect that he could also easily pass the Schedule I & J tests also.

So to answer your original question, Yes there is a good chance that you would qaulify for Chap 7.

You may need to do a little planning with how you handle your girlfriends income, but still seams possible.

[backtoschool]

I don't think anyone is being judgmental in this thread. It is just better to give good advice right off the bat, so that there are not surprises later, and sometimes that advice is not the answer that someone want to hear. (although I do not think that is the case in the OP's case, I am just speaking in generalities....)

Trustees have certain red flags in Chapter 7 that they look for. One of those red flags is people living in the house that are not contributing to expenses. Another red flag is large lump sums of cash that get spent right before filing. We are just trying to make sure that the OP does not incur the wrath of the trustee.

[Ablazed]

How does one amend one's 2008 tax return to reflect a transaction which occurred in March 2009?

[OhioFiler]

Wow, I'm not trying to get with an argument with anybody here, but several posts seem to be pretty judgemental. For the most part on this forum everyone is very supportive of each other. This poster asked if he may qualify for Chap 7, not does anyone think he should try to work out a plan.
Hell, lots of people MIGHT be able to work out a plan, but most on this forum are asking questions (and getting good advice) on ways to get their means test to pass. And good advice is given on how to maximize allowable expenses.

The need to begin your post with this qualifier indicates you expect your opinion to be argued. Can you define "pretty judgemental(sic)"? Offering hard won advice on a forum such as this is valuable. Candy coating opinions with political correctness helps no one.

[Falcon]

Thanks for your responses, folks. Keep them coming. From what I gather from some here.....it would be okay to spend the $8,000 first time home buyer's rebate as a down payment for a used vehicle that is more reliable than my current one?

Also, how do they determine disposable income? Do they actually look at your internet bill, electricity bill, or do they use a standard average for the area?

My "test" on the Means Test showed that I was -$70,000 for 6 years in disposable income. Thanks for your responses.

NB

[backtoschool]

Thanks for your responses, folks. Keep them coming. From what I gather from some here.....it would be okay to spend the $8,000 first time home buyer's rebate as a down payment for a used vehicle that is more reliable than my current one?

Also, how do they determine disposable income? Do they actually look at your internet bill, electricity bill, or do they use a standard average for the area?

My "test" on the Means Test showed that I was -$70,000 for 6 years in disposable income. Thanks for your responses.

NB

If you buy a used vehicle with the $8,000 or use the $8,000 for a new vehicle, make sure that the equity that you have in the vehicle after buying can be covered by the exemptions for your district, or you will end up having to pay the trustee for the amount of the vehicle not covered by exemptions.

[axle619]

Where does it say in the code to include roomates income?

For the means test, you have to use household income. If your girlfriend lives with you, her income and expenses are counted. Your attorney should have told you this.

I just found this site hoping for good information relating to obscure issues. I have found a few things helpful such as the sample petition with the things Trustees look for.

But information like this will hurt readers. Nowhere in bankruptcy code does it say anything of the sort. I really don't mean to sound adversarial, and if I am wrong I will apologize profusely, but i have seen so much misinformation on the net regarding bankruptcy it is really starting to get to me.

A girlfriend who lives with you, or even a fiance, is no different than a roommate. Their income is not used to determine eligibility under the median/means test. Nor is their income stated anywhere else. That would be ridiculous.

However, I am sure it is true that Trustee will look long and hard people that live with you that do not contribute to expenses. Basically, they are looking to see if you are overstating your expenses and getting contribution from others you live with. This is the concern. Reduce your expenses by your girlfriend's contribution to expenses (and any other roommates') and be ready to explain it.

I am in California which is a community property state. However, in this instance, I do not think it is relevant.

Regards,

Alex

[OhioFiler]

I just found this site hoping for good information relating to obscure issues. I have found a few things helpful such as the sample petition with the things Trustees look for.

But information like this will hurt readers. Nowhere in bankruptcy code does it say anything of the sort. I really don't mean to sound adversarial, and if I am wrong I will apologize profusely, but i have seen so much misinformation on the net regarding bankruptcy it is really starting to get to me.

A girlfriend who lives with you, or even a fiance, is no different than a roommate. Their income is not used to determine eligibility under the median/means test. Nor is their income stated anywhere else. That would be ridiculous.

However, I am sure it is true that Trustee will look long and hard people that live with you that do not contribute to expenses. Basically, they are looking to see if you are overstating your expenses and getting contribution from others you live with. This is the concern. Reduce your expenses by your girlfriend's contribution to expenses (and any other roommates') and be ready to explain it.

I am in California which is a community property state. However, in this instance, I do not think it is relevant.

Regards,

Alex

You couldn't be more incorrect Alex. Try Line 8 of Form 22A (Means Test). I'll let you do the obscure research on your own.

[axle619]

How was I incorrect? This has nothing to do with the girlfriend's income. Not even a little bit. The main point being is that the girlfriend's income does not factor into passing the means test. All line 8 does if ask for any contributions made to debtor for debtor's expenses. And this is included in the debtor's income.

Two scenarios:

1) girlfriend splits the rent and expenses like a roommate. In this case, you do not include her contributions to household expenses as this is her liability. Just be sure that the debtor's expenses do not reflect her portion (just like a roommate).
2) the girlfriend contributes to the debtor's expenses. Then the debtor includes to total amount of his expenses and offsets it with her contribution here.

There is no net difference.

The main issue I had was that someone said you include the girlfriends income as household income and this is absolutely incorrect (and dangerous for people to read).

Nothing obscure about this.

[OhioFiler]

How was I incorrect? This has nothing to do with the girlfriend's income. Not even a little bit. The main point being is that the girlfriend's income does not factor into passing the means test. All line 8 does if ask for any contributions made to debtor for debtor's expenses. And this is included in the debtor's income.

Two scenarios:

1) girlfriend splits the rent and expenses like a roommate. In this case, you do not include her contributions to household expenses as this is her liability. Just be sure that the debtor's expenses do not reflect her portion (just like a roommate).
2) the girlfriend contributes to the debtor's expenses. Then the debtor includes to total amount of his expenses and offsets it with her contribution here.

There is no net difference.

The main issue I had was that someone said you include the girlfriends income as household income and this is absolutely incorrect (and dangerous for people to read).

Nothing obscure about this.

You have way more experience with this than those you dispute apparently. It would be dangerous to to try to obscure the fact you live with your girlfriend from the trustee. I'll side with backtoschool's recommendation. I suggest you play it safe and obscure your fiance's income from your schedules.


There is nothing dangerous about bts's response. ALL readers here are advised to seek legal counsel and take any advice given here knowing it is not legal advice. The advice may have endangered you but you ought not speak for any other present or future readers, especially with a post count in single digits.

Have a great weekend.