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    Few questions

    Hello I am getting ready to call our attorney and ask him these questions, I was just hoping to see what everyone in here had to say first. So far we have only had our first consultation and paid $100 down to get this rolling. He gave us a case number and told us to stop paying all of our unsecured credit and refer the creditors to his office. Wow - you talk about a weird feeling, I haven't missed a payment in years! Here's the questions.

    1. He told us they would go off of the amount of our last 6 months of pay.
    My job fluctuates through the year, sometimes overtime and sometimes I
    don't even get 40 hrs. a week. It looks like business is picking up now and
    the possibility is there for me to work overtime the next few months. My
    question is should I work overtime or try to keep my pay as low as
    possible?
    2. Something else we are worried about is he asked us if we were on
    somebody's will where we would be inheriting money here in the next 6
    months or so, we told him no. My mother in law has no will to our
    knowledge, every time my wife brings this subject up she gets very
    upset. So its one of the situations we just avoid. My mother in law is in
    stage 4 Cirrhosis of the liver. From what we have read a person normally
    doesn't live more than a year once they reach stage 4. We don't file
    bk until late July, what would happen if we file and (God forbid) something
    happens to my mother in law? I'm not experienced in this, but I would
    imagine my brother in law and wife would end up inheriting what little she
    has.
    3. I have two loans through my credit union at work, one is for a motorcycle
    that I have about $1500 in equity in and another personal loan for a little
    under $2000. I really didn't want to file against these, since this credit
    union deals so closely with my work. Our attorney said I should file against
    the mortorcycle since I would probably lose it in a chapter 7 and we have
    to claim the other personal loan or the other creditors could throw a fit,
    something about being preferential treatment. Is there anyway my job
    would be in jeopardy since the credit union works hand in hand with my
    employer?
    4. Does the trustee ever check up on you after you have been discharged?
    I am worried that my job might get busy the second half of the year.
    It looks like we might be getting some large contracts later this year
    which would result in me working a lot of overtime. This would result in me
    making more money than before we filed.
    5. Finally, our biggest worry is that we file a chapter 7 and when we go
    before the trustee he forces us to go to a chapter 13 and makes us pay
    a large amount, say $500 - $850 a month. Our attorney at this point
    doesn't think we should have any problem going chapter 7, we are under
    the median income by about $4000 dollars a year. I just don't know what
    we will do if they make us pay a large payment, we will have ruined our
    credit by not making payments on are CC's. And after we file we won't
    have our CC's to fall back on for our basic monthly living expenses.
    Thanks

    #2
    1. The 6 month rule is a strict rule. The court looks at your last 6 months of income (including overtime, bonuses, etc). If you would be below the median state income even with overtime, then you have nothing to worry about. If you are on the bubble with median income and will not be filing for several months, then you would want to avoid working overtime.

    2. When it comes to inheritance, the trustee (the BK estate) has a claim on any inheritance or life insurance proceeds upto 180 days AFTER you file BK. Thus, if you file in July, and your MIL expires in September, anything assets or property that passes to you or your wife, becomes property of the BK estate (unless there is an exemption) and will be used to pay creditors.

    3. There are legal protections against being fired for filing BK, and frankly, most employers don't care. But filing BK with CU sucks, but your attorney is right, you Must list ALL debt. You will need to make a clean break, move all your money out of the CU and open another bank account (with a regular bank).

    4. No, once you are discharged, your case is, as far as you are concerned, is over.

    5. Being forced into a chapter 13 is based on 2 factors: (1) if you are "over" the median income, the trustees at least try to get you into a chapter 13 or dismiss your case (2) whether you have disposable income. In your BK petition, you will list your income and your actual living expenses (schedules I and J). Over the next few months, you need to get a handle on where your money is going. The goal (and your attorney should help you with this) is to show no disposable income on your petition.
    Last edited by HHM; 05-01-2008, 06:08 AM.

    Comment


      #3
      Thanks for the info. I've just read some horror stories where people went to their 341 meeting and got stuck with high payments. So you don't think we would have any problems as long as our schedule I and J show we don't have any extra disposable income? I know there is a category for car expense, we currently don't have any car payments, our cars our 6 -12 yrs. old. Do they take into account that we have a lot going out in maintenance in our old cars? Last year two transmissions, this year a $1,000+ bill for a lower intake manifold, and now its going to cost $600 for a starter on our Volkswagen. And lastly, how much do they allow for fuel a month. I'm driving back and forth 5 times a week to work and 3 nights a week to college. I counted up somewhere around $650 to $750 on average a month just on fuel.
      Thanks

      Comment


        #4
        Lastly, now that I'm not paying my CC's I started putting 6% into my 401K. Is this allowed or will this cause problems?
        Thanks

        Comment

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