Hi everyone. I've been reading through these forums for the last couple of weeks and have learned so much in so little time. Thanks for making this forum one of the best sources for invaluable information.
I am planning on filing really soon but my case is not very straightforward.
Particularly, I've come across one major dilemma.
I own(ed) 3 rental properties,
#1: $200,000+ $20K HELOC --- status: foreclosed --- purchased as: investment property
#2: $220,000 --- status: in foreclosure (360days past due) --- purchased as: 2nd home
#3: $150,000+ $20K HELOC --- status: current on both loans --- purchased as: 2nd home
All properties are/were underwater. I don't have a primary residence; I rent and my income is above state median.
I live in the central district of California, and I have consulted with two lawyers (one from a bk mill) who have suggested to file for non-consumer Ch7, despite the two properties being purchased as 2nd homes. A third lawyer who is not familiar with non-consumer cases wants me to go through the means test route.
My dilemma: what do I do? What are my risks by filing as non-consumer? Anyone know how the Central District of CA deals with similar cases? If the trustee objects will my case be dismissed or will I be allowed to amend the filing?
I don't mind going the regular (consumer) route. The problem is that I fail the means test (over the DMI by more than $100), unless I can figure in the mortgage expenses for property #3 in the means test against my personal income. Here is the breakdown of the monthly net income on the property (averaged over 12months):
rent income (gross receipts) - $500
rent expenses (hoa, repairs, management fees) - $600
mortgage - $700
On line 5a of the means test I have to enter the gross receipts ($500). The question is on line 5b for ordinary and necessary business expenses can I enter only the rent expenses ($600), and can I place the mortgage payments ($700) on line 42 and count that as an expense against my personal income? And will I be able to claim the full $1309 for rent allowance? This is the only way I think I can pass the means test.
Any advice/suggestions would be greatly appreciated.
I am planning on filing really soon but my case is not very straightforward.
Particularly, I've come across one major dilemma.
I own(ed) 3 rental properties,
#1: $200,000+ $20K HELOC --- status: foreclosed --- purchased as: investment property
#2: $220,000 --- status: in foreclosure (360days past due) --- purchased as: 2nd home
#3: $150,000+ $20K HELOC --- status: current on both loans --- purchased as: 2nd home
All properties are/were underwater. I don't have a primary residence; I rent and my income is above state median.
I live in the central district of California, and I have consulted with two lawyers (one from a bk mill) who have suggested to file for non-consumer Ch7, despite the two properties being purchased as 2nd homes. A third lawyer who is not familiar with non-consumer cases wants me to go through the means test route.
My dilemma: what do I do? What are my risks by filing as non-consumer? Anyone know how the Central District of CA deals with similar cases? If the trustee objects will my case be dismissed or will I be allowed to amend the filing?
I don't mind going the regular (consumer) route. The problem is that I fail the means test (over the DMI by more than $100), unless I can figure in the mortgage expenses for property #3 in the means test against my personal income. Here is the breakdown of the monthly net income on the property (averaged over 12months):
rent income (gross receipts) - $500
rent expenses (hoa, repairs, management fees) - $600
mortgage - $700
On line 5a of the means test I have to enter the gross receipts ($500). The question is on line 5b for ordinary and necessary business expenses can I enter only the rent expenses ($600), and can I place the mortgage payments ($700) on line 42 and count that as an expense against my personal income? And will I be able to claim the full $1309 for rent allowance? This is the only way I think I can pass the means test.
Any advice/suggestions would be greatly appreciated.