Need help ASAP! Failed Means test

[jeep75]

You have to think of it like this, that $300 car payment will be going to your unsecured creditors (credit cards) unless you get the car. Using your $200 example, it will be $200 chapter 13 payment, $300 car payment. Or... $500 chapter 13 payment.

Will your paid off car last the 5 years you'll be in a chapter 13 plan without major repairs is another thing to consider.

[Freddy03]

I understand that but I don't have 3-5K to put down on a 5 year old car.

My credit is shot. I have multiple judgments and now a wage garnishment.

[jetsfan2010]

Thanks for all the advice so far -

I'm seriously freaking out.

We called a couple of carmax type places and of course we could get a "newer" car with trading in our paid off car and putting 3k down with 24% interest with a car payment of $300 a month.

There is NO way I will do that. First I don't have any money to put down and I really don't want a $300 car payment for 60 months for that I'd rather be in a very low Ch 13 payment.

Could someone please tell me who a 13 works?

Will getting life insurance help on the means test?? I could up my 401K on Monday and the lastest I would want to file would be Aug 1st b/c of the wage garnishments.

Sorry if this is rambling. I had a very bad day

take a deep breath freddy. things will work themselves out. Trust me when I say MANY ppl are in worse shape than you on here.

1. Life Insureance(Term) can only help your situation. I just picked some up(another expense and a good investment IMHO)

2. the car payment option can perhaps be changed if you have them decrease your term from 60 to 36 months(thus making your payment more) helping your debt.

3. The ch 13 option should be your last resort in a no asset case scenario.

[Freddy03]

take a deep breath freddy. things will work themselves out. Trust me when I say MANY ppl are in worse shape than you on here.

1. Life Insureance(Term) can only help your situation. I just picked some up(another expense and a good investment IMHO)

2. the car payment option can perhaps be changed if you have them decrease your term from 60 to 36 months(thus making your payment more) helping your debt.

3. The ch 13 option should be your last resort in a no asset case scenario.

Does life insurance help on the means test?? I will get it Monday if so. My husband only has a small policy with the VA but not term life insurance coverage.

I really want to avoid the whole car situation b/c the car we have is good and I really don't want another car payment.

I did see online a few other of those title loan places. I guess I can call them Monday.

[debee]

I really want to avoid the whole car situation b/c the car we have is good and I really don't want another car payment. I did see online a few other of those title loan places. I guess I can call them Monday.

Term life insurance is good for the Means Test and Schedule J, but I don't think it's going to solve your current problem. Are you able to exempt your paid off car, Freddy? Is it over ten years old?

[IamOld]

Does life insurance help on the means test?? I will get it Monday if so. My husband only has a small policy with the VA but not term life insurance coverage.

I really want to avoid the whole car situation b/c the car we have is good and I really don't want another car payment.

I did see online a few other of those title loan places. I guess I can call them Monday.

When I did the NOLO test - (Like a TRILLION times) the life ins cost/mo TERM ONLY - is a "deduction" on the means test...

The title loan places...if that's what it takes to pass and stay out of the 13...BUT at least a life ins policy is good to have...especially if you have kids.

[IamOld]

I don't think upping the 401k would help - i distinctly remember atty saying that if we file jointly, 401k is NOT a "deduction" for the means test...wasn't on Nolo either.

[Freddy03]

Paid off car is 2003. I didn't get approved at one title place. I'll try more on Monday.

[Freddy03]

This makes me so mad bc I took the means test 100 times myself and I passed.

[IamOld]

freddy if I may say - I think one way or the other, you'll be able to "get rid" of that $200 - maybe title loan, maybe life ins. However, unless your atty reads emails over the weekend, maybe you won't get FINAL answers until Mon. BUT one way or the other, you can make the $200 go away.

Perhaps you could call a couple of ins agents close to you, and get a ballpark quote for term life for you and husband so that by Mon, you have all possibilities line up.

If you haven't already, do you want to email atty and ask him about a)title loan, b) life ins? Just in case he reads emails habitually :-)

[debee]

Paid off car is 2003. I didn't get approved at one title place. I'll try more on Monday.

A title loan will solve your problem. I hope you can get one. If not, look around for a newer car. There has to be someone willing to finance you.

Since your current car is a 2003, you won't raise any eyebrows if you replace it. It's almost ten years old.

As jeep pointed out earlier you're going to be making a monthly payment no matter what. You have to decide whether it's better to have your personal financial freedom and a car payment OR to be making the same payment (or more) and have the trustee in your affairs for 5 years.

I know you don't have cash now for a car but that is good because you have to be able to exempt the equity in it anyway. You don't want to put 3K into a new car plus your trade-in value unless you can exempt it all. Otherwise, you end up paying the trustee on top of the car payment. If you end up having to get a new car, you'll want to get one without putting any cash into it. You need to be able to exempt your equity.

It isn't ideal. I had to do it too and I didn't want a car payment. I had a perfectly good paid off old beater. There was no point getting a title loan because the blue book was too low. It was new car or chapter 13. The car loan seemed the lesser of two evils.

BTW, What the h*ll happened with the Means Test? Do you know what you did wrong?

[Freddy03]

I was using the 2 car credit thanks again everyone. I'll work things out somehow.

[IamOld]

I was using the 2 car credit thanks again everyone. I'll work things out somehow.

Freddy - I'm the chief pessimist! you cannot have my job!!! :-)

It's "only" $200 - you WILL find a solution and you WILL work it out!

[debee]

It will work out.

Even if you end up with a new car and a higher payment than you want, just don't reaffirm the loan and once you're discharged you can take another look at the situation and check your options then. If you let your house go and manage to save mortgage money post-bk, then you may be able to give the car back and get something else.

Anyway, we're all rooting for you.

[SunshineGal]

Freddy,

It's time to take a good look at your expenses - especially medical and dental. Do you need any major work done? Have you allowed room to cover all co-pays, OTC Meds, prescriptions, glasses, contacts, etc?

Term life IS a deduction on the means test; if you don't have any get some and get it for all of your family members.

Finally, our attorney had us quit retirement contributions; the trustees don't allow you to fund retirement to the detriment of the creditors.

You are SO close Freddy, you only need to find about $100 or so and you'll pass. Good luck and get busy on those expenses, lol.

SG