Motion to extend time to object?

[spydc]

OMG!! I just checked pacer. I was coming up to the deadline of 90 days and I just saw the following filed today:

"Motion to Extend Time To Object to Discharge, in addition to Motion re: Extend Time To File Motion To Dismiss. Filed by United States Trustee. Hearing scheduled for XX/XX/2012 at XX:XX AM at XXXXXXXXXXXXXX (Attachments: # 1 Certification # 2 Proposed Order # 3 Certificate of Service) (United States Trustee, byXXXXXXXX, Trial Attorney) (Entered: 12/29/2011)"

I am so sad now. I thought I was going into a new year with a fresh start now it looks like my chapter 7 filing will be dismissed or I will be forced into a chapter 13. I mentioned when I started this thread that I got a new higher paying job during the time I filed but racked up a lot of debt due to a failed business and low income. What do you think will happen at the meeting? Do I show up at this meeting? I just left a voicemail with my attorney and waiting for him to get back to me.

In reviewing the documents submitted by the UST. It looks like the deadline has been extended to March 23, 2011. Furthermore, what caused them to file this object was beacuse of the schedule J. It showed a monthly surplus of $1700 because I got a new job just a month before filing. so it inflated everything. What should I do now? Should I look for an expensive month to month apartment or something..

[justbroke]

I can understand your frustration.

... what caused them to file this object was beacuse of the schedule J. It showed a monthly surplus of $1700 because I got a new job just a month before filing. so it inflated everything. What should I do now?

That's the key right there. While the filing of the bankruptcy and calculation of "current monthly income" (CMI) looks backwards, Schedule I/J looks slightly forward. In another thread, you mentioned that you started this job before filing and that you actually handed over copies of 2 paystubs from the new job.

The "totality of circumstances" dismissal is found in 11 USC 707(b)(3)(B). This is the so-called "wildcard" that the UST uses in cases which pass the means test, but fail for other reasons. The UST is going to argue that under the "totality of circumstances" test, that you are not deserving or needing of a Chapter 7 discharge. The UST will argue that you should convert to a Chapter 13 or should have your case dismissed.

You will need to work with your attorney to see what the strategy will be on this.

Should I look for an expensive month to month apartment or something.. (

I don't understand this question. You and your attorney may want to work a new Means Test just to see what your DMI would be based on the actual allowances. Your allowance for an rent/mortgage may be more than what you put on Schedule J. Even if you do this, and you're over-the-median (which it now appears), then you will find it almost impossible to get your DMI low enough... unless you had a big mortgage.

[tobee43]

are you an asset case?

it may be because of your increase of income due to your new job, that it may be possible the UST would like to turn your case into a 13 as now you have the income to pay back some of your creditors.

it will be ok, they just may want you to pay some of those back that you can now afford to pay back according to your schedule j. really your atty should have told you with a DMI of 1700 dollars a month, it would draw some attention.

[spydc]

Hi. I was ruled a NO ASSET case. I just spoke to my attorney and I checked the documents filed on pacer. It seems the UST forwarded a subpoena today asking for more documentation but my attorney did not receive it yet. I'm not sure what they will be asking for but i'm assuming more bank statements? Anyway, in the documents, it seems they had a problem with the large amount of unsecured debt vs the schedule j where the net monthly is $1700 because of the new job that I started a month before filing. According the the documents, the UST last time to file an objection was 12/30/2011... which is tomorrow! But now they have extended it to March 2011.

But during this time, I was sharing expenses and I haven't moved yet. I was planning on moving to a new place shortly there after. My attorney knows that I was looking to move soon and asked him if I did. I said not yet. But i asked him if I should go find me a place now and he just told me to wait until next week when he gets more information. This is so sad!

[spydc]

I took the following info from the document and edited some of the numbers:

5. Following an independent review of the Debtor’s petition, schedules and
statement of financial affairs, and the Court’s docket, the OUST identified several issues which
warranted further investigation.
6. For instance, the Debtor’s Schedule F reports unsecured obligations of
$XXXXXXXX.00.
7. In addition, the Debtor’s Schedule I indicates that at the time of filing this instant
petition, the Debtor was employed for one month as a “XXXXXXXX” in which capacity he
earns gross monthly wages of $XXXXXXX and net monthly income of $XXXXXXX.
8. The Debtor’s Schedule J lists monthly expenditures totaling $XXXXXXX. Thus, the
Debtor’s Schedules I and J list a monthly surplus of nearly $1,700.00.
9. On December 29, 2011, the OUST forwarded to Debtor’s counsel a Subpoena
Duces Tecum seeking information which would substantiate the reason for the filing to
determine (i) whether the Debtor’s statement of income and expenses are representative of the
Debtor’s true financial condition and (ii) whether the petition was filed in good faith (“The
Subpoena”). The Subpoena requests documents by January 20, 2012.

[spydc]

In the schedule J, it was listing the income of my new job and the expenses based on the current situation. Where I was living, the rent was about $850 and there were no utilities to pay... plus I had no car payment. I mentioned to my attorney that I was looking to move in the near future because I currently live in a bad place and figured the monthly expenses would go up big time with the new rent and inclusion of utilities. I live in the north jersey / nyc metro area where it is pretty expensive to live here. In addition, due to the fact that my car is breaking down, I was looking to get another car as well. So the schedule J makes it seems like I am very well off and couldn't have possibly incurred all that debt.

Now when you say working on a new mean tests.. do you mean putting in the max allowances to see what my DMI would be afterwards?

Is there any strategy that I should suggest to my attorney? I'm assuming that the UST will be asking for years worth of bank statements and credit card statements from the filing date backwards? My attorney said he wasn't going to object because it is just a motion to extend the deadline and that normaly judges grant them. But he will get more info next week and get back to me.

Another thing I want to add.. The petition makes it seem like I got a new job and decided to file CH7 afterwards. I was offered the job in late August..beginning of September. But the reality is that I had decided to file CH7 before I was even offered the new job. I met with my Attorney the beginning of August and actually handed him all the appropriate paperwork in the middle of August. I actually had a schedule J done at that time that gave me a huge neative DMI. But my attorney mentioned he was so busy that he didn't file until nearly the end of september. He had to modify my schedule J showing the new income. !!!!!!!!!!!!

I can understand your frustration.

That's the key right there. While the filing of the bankruptcy and calculation of "current monthly income" (CMI) looks backwards, Schedule I/J looks slightly forward. In another thread, you mentioned that you started this job before filing and that you actually handed over copies of 2 paystubs from the new job.

The "totality of circumstances" dismissal is found in 11 USC 707(b)(3)(B). This is the so-called "wildcard" that the UST uses in cases which pass the means test, but fail for other reasons. The UST is going to argue that under the "totality of circumstances" test, that you are not deserving or needing of a Chapter 7 discharge. The UST will argue that you should convert to a Chapter 13 or should have your case dismissed.

You will need to work with your attorney to see what the strategy will be on this.

I don't understand this question. You and your attorney may want to work a new Means Test just to see what your DMI would be based on the actual allowances. Your allowance for an rent/mortgage may be more than what you put on Schedule J. Even if you do this, and you're over-the-median (which it now appears), then you will find it almost impossible to get your DMI low enough... unless you had a big mortgage.

[justbroke]

There is really no strategy based on what you have listed. It would appear that the UST (OUST) has a very good cause for extending the deadline to file a complaint regarding discharge. The bankruptcy code doesn't really account for you deciding to file, then getting a great job, and then filing. In fact, the bankruptcy code, after the 2005 BAPCPA changes, actually makes it look BETTER to file just after landing a new job so long as your "current monthly income" (CMI) shows you as eligible.

However, the United States Trustee (UST) is charged with ensuring the integrity fo the program. That is why that "totality of circumstances" paragraph was actually modified to be "standalone" in the BAPCPA (2005) chagnes to the code.

Unfortunately, you were needing of a Chapter 7 discharge, but then landed a good paying job. It would be one thing to argue that you started working with the new job "after" filing; but it's a different story when it is "before" filing. Many times, the OUST would even ignore a new "post-petition" job where the debtor became capable of paying (albeit that there are some limited cases where the UST has gone after those as well).

To me, it reads as though this is going to be a tough one and there is almost no rebuttal. A new means test would allow you to plug in new numbers, but if you're over-the-median and don't have a car payment and a good-sized mortgage payment... it's tough to get the disposable income down below $200/month.

[spydc]

Justbroke, I understand and appreciate your response. To me it is just sad because I had a few of my friends telling me not to accept the job for this very fear. I would have qualified for ch 7 if I didn't take the job but then I would have really had no income. I just lived like crap the past few years and figured this would help me get a fresh start.. which is what i thought ch7 was for. The means test is so crazy.. because i'm looking to move soon which would increase my expenses significantly. Plus i need a car soon. But I guess I have to wait to see what comes out of this. This is why i was asking if I should speed up the process of moving to see if it would help my cause.

In any event, do you know how the ch13 would play out and how the repayment plan is calculated?

[justbroke]

A Chapter 13 plan is based on your disposable income. Right now, it appears you have $1,700 in disposable monthly income (DMI). Working with your attorney, you may find it advantageous to get the Chapter 7 dismissed and refile a Chapter 13 plan after doing some "bankruptcy pre-planning". That may include getting a new car, although that can be tough given that you now have a bankruptcy on your credit report.

However, you would still need to get a workable (livable) Chapter 13 plan. Without knowing all the facts of your attorney, I'm a little worried that your attorney wasn't as concerned about this. It is true that there are many occasions where the UST overlooks new jobs.

In the end, a Chapter 7 discharge is about an "immediate" need for relief (with no need to cure arrears). When you accepted the job before filing, the "immediate" need started to diminish since another form of bankruptcy (Chapter 11/13) was available. At least that is how the UST views it.

You would need to work a new Means Test (Form B22C) with your new "future" numbers to see what a Chapter 13 could be like for you.

[spydc]

Well to be honest, the attorney did mentioned that he was a bit concerned that the new job would cause a red flag. He mentioned that if the ch 7 doesn't go through that they would force me into a 13. Regarding the $1,700 dmi, does that mean I would have to pay $1700 a month to the creditors?

[tobee43]

Well to be honest, the attorney did mentioned that he was a bit concerned that the new job would cause a red flag. He mentioned that if the ch 7 doesn't go through that they would force me into a 13. Regarding the $1,700 dmi, does that mean I would have to pay $1700 a month to the creditors?

well, there you go! most likely the court will work out a payment plan based on your present income.

many people on this site have been very successful with their chapter 13 experiences.

[spydc]

True but still a bit of a bummer nontheless. Is there any estimate of how much I would have to pay in the ch13 plan? It isn't going to be the entire $1700?

[justbroke]

True but still a bit of a bummer nontheless. Is there any estimate of how much I would have to pay in the ch13 plan? It isn't going to be the entire $1700?

No one can estimate that without all your expenses. I suggest that you try the Free Means Test at Legal Consumer's website (legalconsumer.com). It could give you some idea and it, at least, has all the proper allowances for your area.

Remember, that is only a ballpark and there are other factors. This is why it's important to have a good Chapter 13 attorney that can get a plan confirmed that is livable and works for you!