What should I file and should i file

[monkatom]

Thanks for all the info and help so far but I have a few more questions. here are the particulars
CC debt 121K
Student Loan 17K
Mortgage 570K value of home about 560K or so
Monthly income 6,800
Our monthly bills are about 2K higher than our income.
We have been putting everything on CC and using the checks that come with the CC to pay off other bills.
Would like to keep the house if possible.
Have three cars all paid willing to part with two hoping to keep one
So Far I have an appoitmnet with CCCS of san diego and am also thinking about calling a BK lawyer. live in California. i realize I can not forgive the student loans and feel we could pay the mortgage utilities and student loan but the 2400-2500 a month for CC paymnets are killing us. Any ideas on if we should file and if so do we qualify for 7 or will we need to file for 13

[nc73]

If your expenses really are over your income sure you'd qualify. Although with all the cash advances, etc it would be best to wait 6 months before filing, 3 minimum. Stop using all credit cards. Your lawyer would be able to give you the specifics.

[monkatom]

so would I just not pay my CC bills for 3-6 months since i do not have neough money to pay them??

[ameliabedilia]

Yes, you quit paying them. It's money down the drain at that point.

[monkatom]

Thanks for the advice. It just seems strange to not pay. Hopefully the calls, etc are not that bad. Do you think i can still keep the house??

[nc73]

Thanks for the advice. It just seems strange to not pay. Hopefully the calls, etc are not that bad. Do you think i can still keep the house??

But why pay when all of it will be discharged in a 7? Well if you qualify that is..If you have major cash advances it might be best to keep paying the minimum. Since you appear to be upside down on the house you could just reaffirm the debt, and you can keep it. Make sure your payments are current though.

[SinkingFast]

I don't mean to be rude, but,...........

I'd bet if you sat down and thought about your CC charges,......... You'd realize that much of the money was run up because you're weighed down by that HUGE mortgage.

When house repairs came up, did you pay in cash or charge them??

When unexpected medical bills came up, did you pay in cash or charge those??

Auto repairs?? New tires for the cars?? Maybe a utility bill here and there?? Write a cash advance check from time to time to pay another bill or Creditor??

If that sounds familiar, it's probably the house owning you and not the other way around.

If that's really the case, and you're determined to keep the house, filing BK won't help. It'll be band-aid solution to a bigger problem. Only you won't have a safety net of CC's to fall back on. And you can't file again for another 8 years. So you could be stuck.

[ssdsco]

One of the most important steps in planning to file BK is creating a realistic cash and carry post BK budget. Then use BK to eliminate any assets you can't afford which on the surface looks like the house. The payments are probably half your income.

I swapped my $600k house for a $190k house. It's painful, embarrassing but I love the new mortgage payments. Many have reported the post BK financial freedom is well worth the pain of getting there.

[monkatom]

I understand what you are saying and again the advice is great. i did a complete spreadsheet of monthly costs excluding CC debt and compared that to monthly income. By my calculations they are about even. So at first glance I would say yeah we may still be in trouble in an emergency, etc. But I also think I could lower some of the monthly expenses like gas by carpooling and insurance will be lower due to losing a car or two. In addition my wife and I are due raises in January and I am due another 10K raise in july plus if she teaches summer school that should give us additional fall back money. If the lawyer suggests selling the house I am afraid my wife will walk out as last night she said no way will she sell. she would rather sell a car to make the minumum monthly cc payments for the next year and hope for the best than lose the house.

[ameliabedilia]

If you are going to be getting raises soon, you might end up with enough to cover your cc payments and not qualify for a Ch. 7.
No matter what, you should get rid of at least one car. I am assuming there are only two of you that need to drive?
Do you have children or are there just the two of you?
Have you done research to make sure that your monthly expenses are in tune with what the irs allows?

[monkatom]

there are 5 of us and yes only two drive so we will get rid of at least one maybe two cars. I played around a little and seem within theIRS law so I plan to do more research. also called a friend in orange county who is a lawyer and is going to give me the name and number of a lawyer here in san diego. also has anyone heard of doing their pre BK counseling online or is it better to do it in person?

[ssdsco]

If that's the case then do the 3-4 attorney consultations. Lots of advice in the forum about getting prepared so you maximize the value of the normally free sessions. If this is inline with what the attorneys advise stop paying and using the credit cards. Try out your cash budget for 6+ months, see if it works and then file BK. Be sure to talk to the attorneys about any equity in your cars. Lot’s of info on what the 6 months will be like with the creditors and ways to minimize the hassles in the forum.

Keep posting your questions, some very knowledgeable folks will help you out and I'm not one of them. I'm just starting this journey myself.

Good luck.

[SinkingFast]

We actually went with an online Evaluation of our situation before deciding to do anything one way or another.

Hubby and I discussed it and decided to have a professional financial adviser look at our situation. Only problem was, we didn't have money to pay someone. A little bit of Net surfing and we found out about Pre BK Credit Counseling. So we decided to use a DOJ BK approved agency.

Most of the DOJ approved agencies will provide a free analysis of your finances. Give you ideas of where you can make budget adjustments to help yourself.

For us, their advice was seek legal counsel. But, you might get some ideas you haven't already thought of.

[ameliabedilia]

there are 5 of us and yes only two drive so we will get rid of at least one maybe two cars. I played around a little and seem within theIRS law so I plan to do more research. also called a friend in orange county who is a lawyer and is going to give me the name and number of a lawyer here in san diego. also has anyone heard of doing their pre BK counseling online or is it better to do it in person?

We did ours online for $36 with cricket- it was cheap (and a waste of time, but what can you do?)

Definitely see a lawyer or two- this place is the best for preliminary research, that way you only ask the questions you really need and you get lots of advice for free You might want to start quickly so you can file a 7 with plenty of time in between your last cash advances, but before you get a raise. Getting a raise after you are done could be a real boost to your "fresh start".

[monkatom]

thanks for the advice. i am going to pick up a book or two to hopefully gain a little more insight into bk. I am making an in person appoitment with a pre bk counseling company. I also am making two appoitmnets wih BK lawyers.

Couple of quick questions. I should wait 90 days since my last cc purchase before filling correct? And if so I can still get a lawyer on retainer but wait to file? Also it appears my wages are too high for 7 but when I enter expenses etc I meet the means test. one question about the test though is they give about 1800 for rent but my mortgage is 3700 so can i add the extra or will they say move and find an apartmnet for 1800. lastly two months ago I ttok my nephew on from philadelpia to go to school as he was not getting a good eductaion etc. I pay for his meals utilities and some other items bit his dad sends money for his clothes and school stuff. can I say 5 people for the means test or only four?