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New Contributor
LTrain823
Posts: 82
Registered: ‎04-25-2007
0

What would a judge say about my expenses if i try BK?

So i have spent the last 3 days contemplating on what decision I have to make. BK is def in the air but I keep hearing that the that the judge has to agree whether or not i go ch. 7 or 13. Here is my current income and expenses.
 
75k a year is what i make which turns to $3900 a month take home after taxes, ins, and ira.
 
Mortgage : $2000
Car : $260 (lease)
Condo Association : $140
Car/Home Insurance : $200
Utilities : approx $400
Gas : approx $200
Phone/Internet/Cable : $0 (I work in this industry so its paid for by company)
Food/Entertainment: Approx $400
 
So this is a total of approx $3600 in monthly expenses that is not including some other misc expenses that probably add up to $100 a month.
 
I am currently single and I'm planning on getting married in the next 3-4 years. I just bought my new home in June of 07. I am currently taking care of my family as I have two sisters who live with me and my mother and father. I am 25 and my sisters are 22 and 17. My father cannot work and my mother has a part time job because she has to spend time taking care of my father if needed. Luckily, my family lives with me because I am able to pass on some expenses to them. Currently, my 22 yr old sister pays the assocation fee, my mother pays me $600 towards the mortgage and all utilities. The problem here is that my family is planning on moving away in about a year so I cant count on them for long. I dont see the need to try to sell the house especially in this terrible housing market that is currently going on. I have a brand new condo and the builder is still building 70 more condos in my sub so I dont see why someone would want to purchase my home when the builder is selling brand new condos for right around the price I purchased mine.
 
So anyway...I currently have close to $1000 to put towards my credit cards and I am just under 70k in credit card debt. I only have credit card debt and nothing else. I am current on all of them...I have never been late on a payment with any creditor and I have never been late on my mortgage. At this rate, I am never going to be able to pay off the creditors, it will probably take me well over 10 years with interest and thats not including what could happen after my family leaves. I know i can probably find a roommate but i wont count on that for now.
 
I also want to know what happens if I file BK now and get married after a few years. What happens to my spouses income? Will that be reported as disposable income? If so, I wont even bother getting married until I get through this...that would be the last thing I would ever want to do to my wife.
 
Do i seem like a BK candidate? If you genuinely feel with my current situation that there is please let me know. I am thinking about a DMP too but that all depends on what the monthly payment to them would be.
 
So I hope this clarifies as much as i can in my current situation. If there is anything else you would like to know please dont hesitate to ask. Thank you for all of those who has responded to my most recent posts the last few days.
Established Contributor
granny031350
Posts: 951
Registered: ‎12-04-2007
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Re: What would a judge say about my expenses if i try BK?

Because your case is complicated, I would talk to an attorney but here is my take on your situation, and I am NOT a lawyer so take it for what it is worth.
 
First, the attorney will look at who is living in your home and will ask about their incomes.  If only your mom is working part time, her income counts.  If your sister is working part time her income counts etc.  So everyone living there is a part of your financial situation on the day you file.  Now with a chapter 7, that snapshot is a 1 day snapshot, filing day.  With a chapter 13 it is more complicated and if you are losing income when they move in a year, then I would stay away from filing a chapter 13 if at all possible.  If that is the only way to go, the go with your DMP program, not the chapter 13.  If you can do a chapter 7, then proceed.
 
Then your expenses are compared to the IRS standard guidelines and the attorney will throw all the misc stuff in there as well.  I would count internet, phone etc because you are allowed it in the expense section.  Your goal on the means test is to be a zero or negative so as not to throw you into a chapter 13.
 
Your exemptions should cover your home and your car and your furniture etc. 
 
So to file you would need 6 months of bank statements, all cc statements, all loan papers, house appraisal (probably can use the one from a year ago) and see an attorney for that free consult.
 
If he says chapter 13, RUN to the DMP.  If he says chapter 7, then in about 6 months you would only owe on your house and your car and be done.   However it will stay on credit for 10 years but it does lessen in time.  It will NOT affect your future spouse in any way unless after your discharge you make late payments and get into another mess. 
New Contributor
LTrain823
Posts: 82
Registered: ‎04-25-2007
0

Re: What would a judge say about my expenses if i try BK?

how does my mother and sister's income effect this decision? I dont want this effecting my sister at all. she has many credit card bills and student loans she has to worry about...
Established Contributor
granny031350
Posts: 951
Registered: ‎12-04-2007
0

Re: What would a judge say about my expenses if i try BK?

ok I didn't mean to imply your sister would be affected.  But she lives in your home.  So she counts in your "household" as to how many people live in the house etc.  Your BK won't affect her credit or her at all, only that she lives in your home and you help tosupport her etc.  You need to talk to a lawyer asap so he can explain better than I can how it all works.  But in essence all household members are your "household" and all their income counts.  But your attorney will factor out her own bills etc so probably net gain to income there is zero.  The BK will only affect you. 
New Contributor
LTrain823
Posts: 82
Registered: ‎04-25-2007
0

Re: What would a judge say about my expenses if i try BK?

Does having a pet legitamatly count as an expense? Anything else i should look at as being able to claim as an expense?
New Contributor
whoisjohngalt7
Posts: 70
Registered: ‎02-09-2008
0

Re: What would a judge say about my expenses if i try BK?

if you are spending money on him, like food, vet bills, that is your expense, bud. money on it doesn't grow in trees or your pet's wazzooo.lol
New Contributor
LTrain823
Posts: 82
Registered: ‎04-25-2007
0

Re: What would a judge say about my expenses if i try BK?

is there anything else that i should know that may get me into a ch7? I am hoping that i can get in ch 7. What other tips and tricks do you recomend i look into before talking to the lawyer
New Contributor
whoisjohngalt7
Posts: 70
Registered: ‎02-09-2008
0

Re: What would a judge say about my expenses if i try BK?

[ Edited ]
your lawyer would advise you, as well as the mandatory class before filing.

but please realize that i am not recommending you file for bk, but rather, laying out your options as would a lawyer would do if u go see one.

a discharge is not a guarantee.

Message Edited by whoisjohngalt7 on 02-17-2008 06:56 PM
Senior Contributor
Noah_Bodie
Posts: 4,635
Registered: ‎03-11-2007
0

Re: What would a judge say about my expenses if i try BK?

I've stumbled upon more than a few articles about how the BK Reform Act, or BARF, has continued to barf. The means test isn't weeding out all that many people because, shock of shocks, people AREN'T abusing the BK laws. If anything, they are failing to avail themselves of BK long after many a competent accountant or financial adviser would TELL them to file BK7.
 
A number of BK lawyers have written articles stating, in clear terms, they are getting their clients approved for BK7 at rates in the high 90th percentile. If you qualified for a BK7 before the law changed, odds are extremely good you still qualify for a BK7.
 
The biggest change in the BK from BARF was in people's perception. The consumer's "friends in the media" haven't been too helpful in getting that truth out. While the BK laws might have changed, the reality of BK has changed little. You can still do it, if you need to do it.
 
One thing I cannot stress enough--don't go it alone. Get a good lawyer.
 

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