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Wife is having a hard time wrapping her mind around BK (not paying cards)...

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    #16
    Great discussion! This is exactly why I decided against filing pro se despite being someone who loves a "DIY" challenge. We will have no problems in terms of exemptions-the federal limits are way beyond what we need to protect our property, but I want to be doubly sure that we do not do anything improper prior to filing in terms of making sure that what little cash we have is exempt.

    Originally posted by mountanddo View Post
    Totally agree with you Hub but when is too much too much? 3 months of prepaid daycare? Why not just pay for 5 years? Diapers to last until the child is out of them? Food for 1 or 2 or 5 years? All I'm saying is that there must be some limit and that the OP better be sure that he knows what that is. I highly doubt that a trustee would see someone that has 20k in their bank account and the explanation was that we bought food, daycare, diapers etc to last 5 years with that money rather than paying off their debts. That is all I'm saying. Maybe all that stuff as long as it is exempt items and not luxury items is allowed and I'm just naive.
    I get what you're saying, perhaps my first post was not descriptive enough. Essentially, we have the luxury of knowing exactly when my wife will lose her job since she is teacher. She is contractually obligated to finish out the 2011-2012 school year once she returns from her maternity leave at the end of this month. The school year ends June and she will receive her last check on June 30th. Her school is combining classes and cutting others in order to lay off teachers to comply with budget cuts-she is one of those teachers. On July 1st she will file for unemployment, so we know that once that day comes, even though her $460/month student loan bill will go into deferment, there is no way we can pay our credit card minimums and stay current on our mortgage and car payment. Given that, we're trying to go into this as prepared as possible so that this is our first and last bankruptcy-AngelinaCatHub explained our situation best here:

    Originally posted by AngelinaCatHub View Post
    Once you see the end of the dead end street, it is time to use the brake, not the accelerator. The realization and proper planning is the brake our OP is thinking of and I agree with this. It is only my opinion. 'Hub
    July 1, 2012 is our "dead end street."

    Anyway, back to your original points: The daycare for three months is just while my wife is back to work between returning from maternity leave and getting let go at the end of the year. We have no family, friends, or neighbors who can care for her five days per week while we work. We also can't just send her to any daycare because she has a lung condition-the surgeons at Children's Hospital in Philadelphia removed a tumor from her lung, extra vessels from her heart that weren't supposed to be there, etc...one month ago. As a result she needs care that a regular daycare cannot provide. Anyway, its going to cost us about $800 a month which we'll have to forgo credit card minimums to pay until my wife is laid off and can care for her while collecting unemployment. This will all be pre-filing-by the time we file my wife will have been on unemployment for about four months which will ensure that we'll be below median on our six month lookback.

    Now for the food, diapers, etc... The way I see it the first 12 months post discharge are probably the most critical. I will still have my job and health benefits, thank God, but we can expect our medical expenses to rise because when my daughter received most of her care we had double medical coverage. We had no or minimal co-pays and basically everything (the anesthesia bill alone was $5000!) was covered. Once she is only covered under my insurance, it remains to be seen. As for food and diapers, she will be 13 months old when we file, so I would like to have the next 12 months of diapers, baby food, and non-perishables for us stocked up-I'm not talking about 5 years worth or something crazy like that. Basically I am hoping that with the help of a lawyer to guide us, the trustee will look at the totality of the circumstances and recognize that all we're trying to do is guard against this ever happening again. That bring me to the vehicle situation. Right now I have two trucks-one old beater and one daily driver. My wife has a 2001 Toyota Corolla with 160K miles. Car disasters (blown transmissions, engine problems, etc...) were part of what got us into this situation, so again, I am planning on, with the help of a lawyer, converting these assets into reliable transportation for both of us that will be exempt. My daily driver truck is worth about $6000 in the condition its in. If I can get that much the plan is to use a chunk of that to pay the lawyer (about $2000 for a no asset CH7 from what I'm seeing), another chunk to recondition my old beater truck into a reliable daily commuter vehicle, and the final chunk as a cash down payment on a new vehicle for my wife (the Corolla will go in trade). We're looking at a Kia for her because if you buy a Certified Pre-Owned vehicle from a Kia dealer you get a new 10 year/100K mile powertrain warranty with it, which will be worth its weight in gold for us should it break down for any reason while we're still getting back on our feet. I am planning on taking my truck to a shop for a top to bottom inspection with written estimates of what it would take to get the vehicle into good running condition-once I get the OK from the attorney I'll authorize and pay for the work. I'd like to purchase a Kia for myself as well but we will only have room in the post discharge budget for one $200/mo car payment max-no more. Therefore I need to just do all I can to make sure that my truck is reliable.

    I hope that explains things a little better in terms of what I hope to accomplish over the next few months. I'll keep you all posted on our progress toward filing and what advice our lawyer gives us once we settle on one. We will be going for consultations toward the end of the month. I'd like to meet with at least three I think, based on what I've read here. Actually that reminds me-I have questions about the consultation-time for another post ;)

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