New member...with a wierd situation

[(((echo)))]

Ok....I saw a lawyer about filing yesterday, and unfortunately my income is greater than tha amount of debt I have.
My main reason for filing is my current car payment is over 1,000.00
well...
his idea was for me to go out and try to finance ANOTHER CAR! (a brand new one)
so that when the process starts the courts will see my income no longer exceeds my debt.

Is it me or does this make no sense whatsoever?

[Gabe]

It is pretty common advice. It may not make sense initially but the more you read about BK, the more it will make sense.

[(((echo)))]

It is pretty common advice. It may not make sense initially but the more you read about BK, the more it will make sense.

well trying to finance another vehicle opens up another world of problembs...and questions

1..with barely enough to live as is how am i supposed to come up with down payment ect (my credit aint that good)

2..should i just stop making my current car payment and hope this works?

3..what is the judge gonna think when he sees that just before filing i opened up a new loan?

4..what are the odds that it does work....when everything is said and done is the judge gonna want me to surrender the new car as well?

these are Q's i could ask the lawyer...but with only $3 left in my acct till payday i dont think i should be burning up his phone...

I am just so dam scared/depressed...to tell you the truth i just wanna run, maybe mexico or canada. This may sound funny but im losing sleep...i cant eat....smokin 2 packs a day

[pd1373]

Maybe I'm missing something here, and not to delve too deeply into your finances but if your reasonable monthly expenses (not just your debt) are lower than your income and a car is your problem, why not skip the bankruptcy and just let the bank repossess the car? Just one of those monthly payments is enough to buy a used car that will get you around until you save up enough to buy a better one for cash. How did you end up with a payment that high anyway? Expensive car with a rollover loan?

By the way, the stress is normal, sorry to say. Many of us have been through that, so you're certainly not alone. Debt is a mental health killer. The good news is that once the debt situation clears itself out your mental and physical health will improve.

[Cali]

I would rather BK a car than to let it be repo'ed.

If the main debt is the car, then the OP can try to sell it and get a cheaper one.

Maybe I'm missing something here, and not to delve too deeply into your finances but if your reasonable monthly expenses (not just your debt) are lower than your income and a car is your problem, why not skip the bankruptcy and just let the bank repossess the car? Just one of those monthly payments is enough to buy a used car that will get you around until you save up enough to buy a better one for cash. How did you end up with a payment that high anyway? Expensive car with a rollover loan?

By the way, the stress is normal, sorry to say. Many of us have been through that, so you're certainly not alone. Debt is a mental health killer. The good news is that once the debt situation clears itself out your mental and physical health will improve.

[keepmine]

The entire post is confusing. OP, could you explain why your lawyer thinks you'll have trouble because your insome is more than your debt?
Start at the beginning. What is your income and how much debt do you wish to discharge? Also, are you above or below the median income for your state?

[(((echo)))]

ok...in a nutshell

My income "at this point" is aprox $700 above my monthly debt, so a BK judge is gonna tell my too bad suck it up.

:factors that turned me to BK:
I have previous debt that has not made it to the table yet due to the age of the accounts (been in debt so long that i actually have no idea who I owe $$ to) I have already done a credit report and is shows accounts that are in collection status but they havent come after me yet.
I also have a company threatning to take action against me due to a repossesion of over 5yrs ago, i had been making payments but I had to skip a couple...well they sent the account to another agency and they want the $5,600.00 immediately (needless to say i aint got it)

My current vehicle is a 2005 hummer H2 (got it from easterns NEVER GO THERE)!! anyhow, they sweet talked me into $1,160.00 payments for 72 months at 22% intrest (yes im retarded)
price it's worth....$21,000
price i owe.........$43,000
after the intrest, you do the math

So i opt to get rid of the hummer and get something cheaper (a beater...anything)
I dont have the option to trade it in because NO ONE is gonna let me tack on the difference, and NO ONE is gonna wanna buy it outright for that price.

So the lawyers idea, since i'm an average of 700 ahead of the game, to try and file a Ch13 wich i guess lets me let go of certain debt while keeping others? (i dunno...like i said i'm retarded)
Go to a car lot (a new one preferably) and finance another vehicle (one more cose effective) that will "use up" the $700 difference.

So when it comes time, i will "voluntarily surrender" the hummer and the judge will let me keep the other more economical vehicle.

The prior repossesion ppl are already talking about court dates/layer fees/ garnishments.

I cant eat
I cant sleep
I'm afraid to answer my phone
I'm almost tempted to hitchhike to canada or something and just asume a new identity.

[rrockinggramma]

running away never solved anything I have learned, although it sounds good at the time. use your energy to get yourself organized. first of all, follow the attorney's advice. Go get another car that you can reasonably afford and that will last without much repair etc. Then start pulling your credit reports and make lists of original creditors, collection agency debt collectors, everything. He is right. File, then return the Hummer. We have all walked in your shoes (well not the 2 packs a day for me but all the other stuff)

[FreshLikeADaisy]

Echo, I've been there. Most of us have.

But I think either a 7 or a 13 would be an improvement for you, honestly. I don't know what your total debt is, but if you're scared of garnishments, etc, either one would stop that altogether. Also, in either chapter you can get out from under that monster car debt, so that should not be a deciding factor on which chapter to choose.

While the amount left over monthly is A deciding factor in whether to file Ch7 or Ch13, it is NOT the only one!!!!

If you only have $3 in your acct til payday, but your atty says you have $700 extra at the end of the month, somebody ain't right. So my own advice would be to sit down, turn off the phone , get paper and pencil in hand, and tot up *all* of your debt, *all* of your expenses. Pull your credit bureau if you have to, pull your checking statements and credit card statements, whatever you have, but sit down and figure out 1) how much you owe *total*, 2) how much you make, 3) what your monthly expenses REALLY are, today, 4) whether you are over or under the median income for your area (this has a lot to do with whether you file a 7 or a 13) and, assuming you didn't have to pay all your unsecured debt every month (credit card payments, especially) how much 5) you reasonably could afford to spend on a car payment every month.

To me, you have to answer these questions for yourself before you can go any further with any peace of mind.

I'm not real certain about the car situation as you've described it; I too would be scared of jumping out of the frying pan into the fire with a new loan. And "using up" a non-existent spare $700 every month with a car loan doesn't sound good to me AT ALL. But I *will* tell you that many people do finance new cars immediately prior to bk, so that they have something dependable to get them through the years of a 13 or to carry forward from a 7, so it's not at all uncommon. The trick is to figure out what payment you could live with going forward, and I guessing it *isn't* $700 a month.

Also, it doesn't sound like the atty explained the difference between a 7 and a 13 very well, nor does it sound like he totted up your expenses realistically, so I wouldn't depend on that at all. You should know that Chapter 13s are more lucrative for an atty than a Chapter 7, so it is not unknown for an atty to steer you to a 13 when you actually qualify very well for a 7.

Before you hitchhike to Canadia be sure to look into what you can do here and now to make your situation better for yourself. Please allow me to encourage you to learn as much as you can about the differences between Ch7 and Ch13 before you decide, and to see several other attys before you pick one. The initial consult is often free, so you really can pick and choose and ask them all your questions before making up your mind, and I think you would be wise to do so very soon.

There is another section on this forum called "Collection Problems" where there's a lot of good info on how people are dealing with imminent lawsuits, garnishments, etc. You may find some useful info there as well.

I wish you well. Good luck!!!

[keepmine]

I'd agree with the last 2 posts. Get yourself organized and find out exactly where you stand budgetwise. For the record, you're talking about dispsoable income and we need to find a way to get it around $100/month.
A reasonably priced {financed} car is gonna be a big first step.

[(((echo)))]

I want to thank you all for your advice....i know im not alone in all this, i just glad i found you guys (and gals)

[Phillymanhere]

Echo,
I got a question; you say your monthly income is $700 above your "monthly debt."

Do you mean "monthly expenses"? ...

Just making sure you're not thinking that in bankruptcy you're supposed to pay ALL YOUR income to debt payment. You are allowed to eat, pay rent, buy a computer, pay for medicines, doctors, dentists, clothes, etc.

So chapter 7 requires a person to have less than $100 after paying all your bills, not just monthly debt payments!

Just making sure there isn't a miscommunication in here somewhere.

[(((echo)))]

Echo,
I got a question; you say your monthly income is $700 above your "monthly debt."

Do you mean "monthly expenses"? ...

Just making sure you're not thinking that in bankruptcy you're supposed to pay ALL YOUR income to debt payment. You are allowed to eat, pay rent, buy a computer, pay for medicines, doctors, dentists, clothes, etc.

So chapter 7 requires a person to have less than $100 after paying all your bills, not just monthly debt payments!

Just making sure there isn't a miscommunication in here somewhere.

after all my expenses bills/food/clothing ect i have an excess of around 675-700...but that fluctuates do to my work...(i only work 16 days a month) so some of my paychecks are bigger than others depending on how much overtime i put in (which i have stopped so that my income doesnt look so great)

[(((echo)))]

here is the "breakdown info" i gave the lawyer to go by

yrly gross...$53,000

monthly net $3000. (variable)

Various bills...
hummer pymnt....1,160.
hummer ins...........110.
rent, util incl.........675.
cs.......................308.
bank loan.............130.
best buy................30.
XM.......................11.

total bills...........2,424 with an excess of about 525....which fluctuates because some months i bring in 3500-3600

Im not paying on my past debt due to no payment schedule has been set up, i was giving 150-250 a month to a past reposession but had to stop because of low funds....now they want ALL of it NOW and its in the 5500 range.

[Gerry]

Hi, echo. I'm new here, but I just want to throw a little encouragement at you. I know that feeling of dread very well, as I'm sure everyone here does, but I always feel better when I suck it up and face the numbers. Take a deep breath, open all the envelopes and make the appropriate piles, and write down all the numbers. Sometimes it's sooo danged hard to force yourself to do it, but you'll feel better afterwards.