How worried should I be?

[unkelaaron]

Hey Gang
Had my 341 on Monday. Good times as advertised. Filed chapter 7, no asset. Well over the median, but scraped by means test.

About 2 weeks ago, UST requested additional docs from my attorney, 1 year bank statements, 6 months canceled checks, and more recent paystubs. We supplied all of these docs to our attorney.

Right before the 341, the attorney explained that he still had not heard anything back from the UST regarding those docs, but he should hear something in the next week or 2. My heart sank. With all of the anticipation leading up to the 341, I was hoping to walk out of there with some sense of closure. Now, I knew this wasn't going to happen. He said worst case scenario, i would be kicked to a chapter 13, with a small payment. I dont think I would have ever gone down this road to end up in a chapter 13.

Sat down for my 341, 1st thing the trustee mentioned to my attorney was that he still hadn't recieved some of the docs requested, including my tax returns and recent paystubs. Awesome way to start. My attorney explained he sent them in electronically, but had a copy. We recieved a pretty substantial tax return this year that we were not expecting. He asked if I had spent the money. I said no sir. He said, thats good. So, in my mind, I kissed that money goodbye. At the end he said he had nothing further, wished me luck. Afterwards, my attorney tells me that went well, I'm like, what 341 were you at? I went and bought a coffee and a pack of cigs, and I dont even smoke.

Made it through the 341 and yesterday there was an update on Pacer, Trustee report of no distribution. Now, although I know this is good news, I still dont feel I can exhale yet because of the UST situation.

Anyone been through this before? Was soooooo looking forward to the feeling I see so many of you get when you come out of your 341's.

thanks
Aaron

[oregonpilot]

hi unk..well the report of no distribution is a really good beginning.
trustees comment about that its good that you hadn't spent the money yet is kind of an interesting comment!!
I wouldn't kiss the money goodbye quite yet BUT i probably wouldn't take a cruise around the world with it either though. LOL
Glad you made it thru the 341 and good luck.

It's a bummer to not be able to come from the 341 with a little closure but it will come. it's gonna B O K.

[free2breathe]

I agree, in most cases seeing that Report of No Distribution would make you jump for joy. I think the fact that it was entered so quickly after your 341 probably bodes well for you. I searched for similar situations, and I couldn't find anything one way or the other regarding the odds of the UST changing that report. Hopefully your attorney will get back to you quickly once they hear something from the UST. Good luck!

[btbeme]

A UST may ask a Trustee to clarify their findings, but they seldom reverse a decision. The Trustee wants to stay in the good graces of the UST and wouldn't do anything to get them sideways on purpose, so I'd relax.

Regarding your tax refund - you may be asked to cough up a portion of it now or later. Park it in the bank for a year...don't spend it. Your case can be opened post-discharge by the UST for some time, though it likely would not be a full cavity search - just a nice request for a portion of your refund.

And, something I'd like to point out - kudos to your attorney for having a copy of the "missing" docs with him. I'll say it as loudly as I can - ain't no such thing as a document that hasn't gone missing. Have copies with you at your 341 - all of them, always, end of lesson.

[AngelinaCatHub]

If we, with all our mistakes and no guidance showing ourselves honestly into an asset case, with preferential payments made it through bk, you certainly will. At least you have 60 days to wait, not three years as we did. In our case, we would not even worry about a UST as we didn't even know what one was, and we never sweated a 341 as we were simply told to go and do this, that, and the other. Walked in with no worry and walked out with no relief. I guess ignorance is bliss, but once we learned how poorly our lawyer treated us, we went after her in a Motion to go pro se and she lost a day of work. The Judge stated it was our choice to extend our bk but there was no reason to do so since we for all practical purpose were done. We took his advice and our case soon was discharged.

[unkelaaron]

You are right Angelina, Ignorance is Bliss. If I just listened to my attorney, and didn't do as much research as I have, I would not have had 1/10th of the stress. It was worth the stress to have the knowledge and guidance that you all have provided on this site and I thank you.
btbeeme, if my attorney was able to exempt half of the tax refund because my wife did not file, and said he was going to get the other half included in my exemptions, does that change the scenario you describe?
And you are right about extra copies of documents, even though my attorney told me to just show up with SS Card and License, I had a binder 5 inches thick with everything...Just In Case!

[unkelaaron]

well things have taken a giant turn for the worse. Get an email from my lawyer today , subject line, The Other Shoe Dropped. Great. Not a phone call , an email with that subject heading. The UST's saying that presumption of abuse arises, and my case is either going to be dismissed or kicked into a 13.
The difference between the 2 means test are pretty large. My attorney has disposable income of $43. The UST has disposable income of $1,573. How does that happen. There is almost $1,000 difference between my income on the 2 tests. With all of my paystubs, I'm not sure how the attorney makes that big of a mistake.
I'm posting mostly becuase I am absolutely falling apart right now, but I also have some questions.
Any help is appreciated. I'm just at the end of my rope as I type this.

Line 22A Local Standards, transportation. My attorney put 1 vehicle. My wife and I both have a vehicle, shouldnt he have checked off 2, and instead of $277, would it be double? Plus, I pay more than $277 a month in gas, how is that the allowance for operating expense.

Line 30-child care, our 4 year old has been going to daycare for $190 month, so they have $760 in there, but we have a newbory that was born in December, hasn't started daycare yet, but will be. should his cost be in there? We need for my wife to somehow find a job, and his daycare will be a minimum of $1k month.

Line 32- tellecommunication service, I have to have internet access on phone for work, and we have a tmobile bill of $220, UST is only allowing $60

Line 39, additional food and clothing, we have a new born, obv they are growing and they dont eat the same food as us, we had only put $50 in there, UST took it out.


Line 42, a, Mortgage, they both took the 1st mortgage from our rental property, $1498 and the 2nd from our primary res, $501, for a total of $1,999 instead of using the 1st mortgage from our primary res, $2,048.

I just dont know what to do. My wife isn't working anymore, so the $2,600 per month they have for income for her is gone, yet included in the means. My attorney had assured me that if we had to switch to a 13, my payment would be minimal, sub $200, not $1,742! never would have done this.
What kind of options do I have? I can't go into a plan where I pay $1,742 month, that would be paying more than I was paying before filing BK. Obviously couldn't afford life as it was, definitley not a plan that would work out, not even close. If the case is dismissed, what are my options down the road a little bit. Sorry, just beside myself right now and completely devastated.
thanks
Aaron

[Lalalink]

Hang in there... hopefully someone will be able to help from this forum... but some questions that may help someone better help you:

Did you file jointly or just by yourself? That would help answer the car question(s)....

You mentioned $190/month for childcare... did you mean per week? If your wife is staying at home right now, perhaps the UST believes no childcare expense should be allowed (or the amount is frivolous, in his/her opinion)?

Did your wife recently stop working? If so, perhaps the filing of the BK was too early... Waiting for your wife's income to age-out of the "Monthly Income" calculation...

New to this myself, so wondering if you can back out of this and file again in a few months... someone else would have to answer this question...

So sorry you are feeling devastated right now. It really sounds like your attorney let you down with what to expect (or is just plain clueless)...

(((hugs))) breathe, breathe, breathe (and stay away from the smokes!)
Lala

[IamOld]

First my thoughts and best wishes to you!!!!! Re cars - I think if you are a two-person household - that is husband/wife have a car, you - whether you are filing solely or not - if you are including the other person - especially if you are paying car loan, are able to claim both cars....

Maybe your atty needs to go to bat for you, argue and haggle of the numbers - seems like a numbers "game..."

Perhaps this will wind up with the bk judge????

One of the problems I see and others also, that some atty's just do not communicate and prepare you...

[BoxerLover]

I am going to have to assume that the daycare is the problem. Everything else you listed is very minimal. I don't know if you can do this, but if you can I'd voluntary dismiss...wait until her income falls off, and refile a chapter 7. What is the difference of the income and expenses on schedules I & J, that's where the payment for the Chapter 13 is determined from.

[AngelinaCatHub]

You are right Angelina, Ignorance is Bliss. If I just listened to my attorney, and didn't do as much research as I have, I would not have had 1/10th of the stress. It was worth the stress to have the knowledge and guidance that you all have provided on this site and I thank you.
btbeeme, if my attorney was able to exempt half of the tax refund because my wife did not file, and said he was going to get the other half included in my exemptions, does that change the scenario you describe?
And you are right about extra copies of documents, even though my attorney told me to just show up with SS Card and License, I had a binder 5 inches thick with everything...Just In Case!

Thank you very much for the nice words. We all here on our Forum attempt the best we can. You have a very nice Trustee. We did as well. They are human being too, even if they work for the creditors.

About the preparations you made, best to be over prepared than surprised. You did good. 'Hub

[Lalalink]

Re cars - I think if you are a two-person household - that is husband/wife have a car, you - whether you are filing solely or not - if you are including the other person - especially if you are paying car loan, are able to claim both cars....

Yep, I believe I goofed on the filing status being relevant to this. (sorry, and thanks for the correction IamOld).

Line 22A Local Standards, transportation. My attorney put 1 vehicle. My wife and I both have a vehicle, shouldnt he have checked off 2, and instead of $277, would it be double? Plus, I pay more than $277 a month in gas, how is that the allowance for operating expense.

Still trying to figure out why your attorney only checked off 1 car. I'm assuming you own both cars outright, thus there would be no "ownership/lease" expense for the cars. Some districts (such as the Ninth District) allow you to add an additional $200 per vehicle to the standard allowable operating expenses line of 22A, if the cars are "older than 6 model years or has more than 75,000 miles." How old and how many miles on each of your cars? Looks like you are in District 1.

Perhaps on the schedule J, you would have to show actual vehicle expenses? Or does the code allow the standard allowances on these schedules without questioning them as long as your expenses do not exceed the "standards".

And it looks like I found my answer from above, you filed without your wife. Did he list your wife's car on the Schedule B (personal property)? If not, that could be why he only listed one car on the 22A.

Hang in there...
Lala

[Lalalink]

You have a very nice Trustee. We did as well. They are human being too, even if they work for the creditors.

'Hub

I'm afraid we may have unintentionally buried Unkelaaron's latest update (today); looks like the UST is now giving him angst. Any ideas on how we can help him?

Lala

[momofthree]

The solution is pretty cut and dried. Let the case dismiss and re-file once your wife's income is off of the look-back.

As far as the difference:

$760 daycare (isn't a valid expense when 1 parent isn't working.)
$160 amount of cell phone that is objected to
$50 disallowed additional food expense
$550 incorrect # on your mortgage expense--this is a clerical error and should be easily remedied.

= $1520 difference between your means test & the trustees.

Just wait until her income falls off and none of it will matter.

[unkelaaron]

Thanks for all of the advice. As far as the daycare costs, hopefully my wife is able to find employment sooner than later. The kids will be going to daycare, at the very least, we have to pay for our sons pre-k starting in September.
My attorney got back to me via email late last night. His excuse was "I believe I transposed a couple numbers to be that far off on the income.:" Um....really, aren't you the pro here?

Moving forward, is there a difference if the UST dismisses the case or its voluntary?
So, 180 days from the dismisal, I can start all over again filing a chapter 7? Using income from those 6 months?

Any advice on how to handle current attorney? he just completely dropped the ball so many times, during the process I had to point out corrections constantly, and now he "transposed" a couple of numbers. What did I pay him for?