Am I being "shady?"

[ju5tin]

First post.. Long time lurker. Since my wife and I have been talking about filing bankruptcy, my mind has been getting the best of me. Cliff notes of my situation: I have been battling with BofA for over a year trying to do a modification on my house; we owe 30k in late fees. The house is also worth about 60k less than what we owe; I have about 15K in consumer debt. My wife and I have decided to include our house in the BK once we file. I am filing individually, not with my wife.

NOW, the tricky part: I have a job where if I don't do any over time for the month, we fall within the median income to qualify for chapter 7. As it stands, my last six months I picked up a ridiculous amount of overtime to prepare for our baby coming soon. We talked with a BK lawyer, and he said I would have to file for a CH 13 right now- but if I don't work any overtime for the next 6 months, and we add another member to our household (which we will in may), we will easily qualify for CH 7 without even having to do the means test. Obviously, this plan sounds a lot better- to wait 6 months and then file- but I feel kind of bad doing it. My wife is all for it, because with the amount of overtime I've been doing in the past few months has really put a hindrance on our relationship, as well as mine and my daughters. She says she happy with me making less as long as I'm home more.


My question is: would you guys and girls consider this unethical or fraudulent or just wrong? In my opinion, I really want to do what's best for my family and to be with them more. I just don't want to be looked at someone who cheated the system.

Justin

[IBroke]

My question is: would you guys and girls consider this unethical or fraudulent or just wrong?

IMO, neither unethical, fraudulent nor wrong.

What you are doing is what anybody should do before filing: Preparing or having a plan that works!

Think of it: You are not cheating the system - you are just obeying its rules.

[TXskyblue]

The only way I was was able to qualify for a 7 was by stopping all overtime for 6 months.

Not shady at all. BK is supposed to be a fresh start. What kind of fresh start begins with having to work 30 hours of overtime a week just to make ends meet?

[ju5tin]

The only way I was was able to qualify for a 7 was by stopping all overtime for 6 months.

Not shady at all. BK is supposed to be a fresh start. What kind of fresh start begins with having to work 30 hours of overtime a week just to make ends meet?

That's refreshing to hear. I just don't want the trustee to look back at last years' w2 and ask me why my income is so low now (same job/employer) from the previous years. Will "because I want to spend more time with my family" suffice?

[bcohen]

What you are proposing is known as bankruptcy "pre-planning" and it is neither wrong nor fraudulent. It is no different than waiting to file until you receive and spend your tax returns, and spend down non-exempt funds on living expenses. Many people do these things--and I might add that I myself did them--and I don't feel bad about it. Unless you have secured property which can only be protected in a Chapter 13, or defaulted student loans, which can only be managed in a Chapter 13, do what it takes to qualify for the Chapter 7.

[ValleYum]

That's refreshing to hear. I just don't want the trustee to look back at last years' w2 and ask me why my income is so low now (same job/employer) from the previous years. Will "because I want to spend more time with my family" suffice?

You're having a baby! You want to participate in their infanthood/childhood and help out your wife.

Good luck!

[Drazil65]

Strategy and preplanning is the smart and preferred method when it comes to filing chapter 7. We all wait for different situations or timing periods in order to position ourselves in the best place to move forward. If you go back and read many of the posts regarding timing of filing you will see it is the smart way to go and your best shot for success. Good luck and congrats on the new little one on the way...

[frogger]

Not shady at all, just proper planning. We planned for 2 years before we filed.

[tobee43]

i'm with the frog and others on this, we waited just a bit over 3 years as we moved to another state and needed 2 years residency status to use that states exemptions. again, its being smart to plan. best of luck! an welcome to the board!

[LadyInTheRed]

Listen to your wife. After all, isn't she almost always right?

[Pjmax]

If asked, I would just say you had a cutback in overtime. If questioned on this further, then add that you were needed at home due to the new baby. Always tell the truth, but the best advice at a 341 meeting is to not volunteer any info. Best answers are yes sir/ma'm, no sir, and keep specific answers brief. You'll do fine. Congrats on the new baby.

[Malazan]

Yeah, Pjmax hit the nail on the head. Your wife is pregnant, and you had to cut back on OT to help around the house. I doubt it would be something that will be brought up anyway. No one should be expected to work 70 hours per week for extended periods of time.