Was told that I can't do Chapt 13 or 7 !

Anonymous · ‎05-07-2008

I will try and make this short, but I went to see an attorney last week and gave them my household income and was told that we made too much money to file chapter 7, which I kind of new. So I assumed we could do a 13, but when I told them our credit card debt (about 48K) they said that the court may make us pay 100% of the debt in the chapter 13. I showed the attorney our monthly budget which showed us in the neg about $400 a month after "normal" household expenses. I don't get how can we pay 100% of the debt back if we are in the hole every month? I have never heard of filing a chapter 13 and then paying 100% of the debt back?? On top of that...he said it will cost about $3500.00 to file a chapter 13. Ugh......

Our issue is that our house payment is $3,500 a month and then you tack on all the other stuff. We can't even sell our house because of this market! HELP!

Julie

Anonymous · ‎05-09-2008

This is what I found: http://www.uscourts.gov/bankruptcycourts/bankruptcybasics/chapter13.html

TigerCat · ‎05-10-2008

There are many variables when filing a 13 jengland, and I think a lot depends on the assets you have. One thing that helped me when I filed was that I didn't own my home, so my ccc's are only getting 2% of their balances. That $3500.00 figure sounds about right. That's approx. what mine cost, although my attorney fees are added into my plan so he is paid monthly from the Trustee. If I were you, I would talk to another attorney if you are not comfortable with the one you spoke with. I was blessed to have found an excellent one on my first phone call.

granny031350 · ‎05-11-2008

you need a second opinion. I suspect that after you list the allowable expenses, (check out the IRS guidelines for allowances etc) what he was saying is that you have enough left over in disposable income that if all of your creditors filed claims, you would be paying them back at 100 percent. However just remember that interest does NOT accrue on the cc debt and NOT ALL creditors will file a claim. So if you are 100 percent payback, you will only pay back those creditors that file a claim at 100 percent. That means you could be done in a heck of a short time and be debt free. But get another opinion.

Anonymous · ‎10-06-2008

I agree with Granny, you need a second opinion. Unless you have filed for a BK within the past 4 years you should be able to file BK now. You probably go over your state's average salary calculation (I did, it's fairly low) and don't qualify for a 7, but you should be able to file a 13. I am in 13 now, paid $750 up front, and the attorney gets another $2250 over the life of the 13 repayments, but they are paid through the BK by the trustee so you aren't coming up with that 'extra' money, it's lumped into your monthly payments. If you come up with a monthly budget that allows for standard allowances but leaves you in the hole $400, I'm not sure what happens since the idea here is to pay back something to the creditors. I have seen posts saying this can be as little as 3% (mine works out to 21% just as reference.) Keep in mind that any taxes, child support, and mortgage arrearages take priority before they pay back insecured CCs. You'd be looking at a 5 year repayment for sure (I believe the 3 yr has been done away with, at least in OH.)

Get a second attorney to check it out and GL.

Thaylin · ‎10-09-2008

One thing to remember is that is that the laws to deal with BK has changed in the past few years. I have been talking to my lawyer who mentioned some users could still be in the hole month to month because they no longer use just disposable income. Now in chapter 13 there is a % of your debt that has to be paid in order to get discharged.