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Shyenne

Do I Qualify for Ch 7?

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I have about $17,000 - $20,000 in cc debt. 2 years ago I signed on with a consolidation co who gave me the run-around and basically stole my money and did not give it to the debtors. The BBB has been unable to locate them as they closed up shop and went into hiding, but they have received other complaints like mine about this same consolidation co. Because of what they did, my late fees, interest and over the limit fees went through the roof. Yesterday I was served a judgment by 1 of the cc companies- I am supposed to go to court in Nov. They have added over $2,000 in attorney fees to the debt as well. I have no assets - no house, no car, no valuable possessions at all. I do have a job but I support myself and my bf and have barely enough to pay the rent and regular bills, there is very little left at the end of the month. I don't have cable tv, I don't spend money on clothing except when absolutley necessary, I do not buy luxury items. Do I qualify for Chapter 7 or does the fact that I have a job mean they can garnish my wages? I am afraid that if they do, all the other cc companies will follow and take me to court as well, but I know that if I file Chapter 7 they can't. What do I do?

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"Qualifying' for bankrupty is not necessary. You either have money to pay your bills or you don't. If you have nothing left over after all your NORMAL living expenses, then you're a prime candidate for a Ch 7. CH 7 'qualification' is all about disposable income. If you have $100 or more left over after all your regular expenses are paid then you may end up with CH 13 - or a dismissal. Doesn't sound like that's the case for you. There is nothing in the Bankruptcy code that says you have to be unemployed to file. If your debts are more than your assets, you ARE bankrupt.

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Thanks for the responses.

So, if I have $100 or more left over, but that does not include any payments being sent to cc companies, than I may have to file CH 13 even though the $100 is not enough to distribute amongst the creditors? (I have about 5 creditors all together who are not getting paid due to lack of funds - I don't think they'd settle for $20/month each and it would take me the rest of my life to pay off that way!).

What exactly is meant by "dismissal"?

Also, how much do most bankruptcy lawyers charge? I know it's $200 to file, plus attorney fees. I'm not even sure I have enough to pay that, but will have to come up with it.

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Shyene

from my personal experience, when you list your expenses your probably tempted to just write down rent, utilities, food etc., but don't forget the expenses of a pet, medical, clothing, insurance, gas, car repairs and much more. There are alot of exceptable expenses people don't think about, my lawyer had to point this out to me. Try to think about occassional expenses you have over the course of a year, not just this month.

Since you have a "no asset" case you may look into filing yourself, by coincidence a co-worker and I had our cases discharged on the very same day, likewise she had a no asset case ( no home mortgage or debts you want to reaffirm such as a car loan) she paid $200.00 for forms and advice from a para legal, I paid $700.00 to a lawyer, who incidentaly filed my case too soon, thereby endangering the court accepting my case, cashed my post dated check ( that he asked for) immediately and failed to give me a copy of the court documents that I consequently had to pay $20.00 to get this year!

There is alot of help with filing yourself on the net. What state are you in?

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I am in the state of Tennessee.

Wow - $700 for a lawyer to file bankruptcy? Seems sad to have to pay $700 (plus the $200 cost of filing) to prove you have no money. Almost a thousand dollars later... I definitely will have no money after that! What you say about the lawyer messing up your case... that's scary. I would do the paperwork myself if I weren't afraid of doing something wrong and having it thrown out of court. I know basically nothing about this sort of thing. I guess I will have to contact some lawyers and see if I can find one that doesn't charge an arm and a leg... doubtful, I know. This is scary stuff. I have about 5 weeks until the court date. What do you guys think about me calling the suing creditor and telling them if they don't drop the charges I'll be forced to file Chapter 7? Would that get them to drop the suit?

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Probably not. They hear the threat of bankruptcy ALL the time. It means nothing to them unless you can stick a bankruptcy case number under their pointy noses !

Where in TN are you ? I'm in Nashville, and you can DEFINITELY get a decent lawyer for under $700 here. You need to call around and get a couple of free initial consultations. Some lawyers will take payments, but most won't file until their fee is paid up.

You can also check this out:

http://www.cletn.com/PubSpecRslt.asp

That is a list of TN Bankruptcy certified specialists - all TN cities ;)

I agree about the expenses, most people seriously underestimate the amount of money they spend on a regular basis. Its a long list when you sit down and REALLY think about it. Take out your checkbook for the last year and add up ALL the things you've spent money on, except extravagances, over the year. Bet you'll find its a LOT more than you think ! You can even include b'day and holiday gifts - its a normal expense. You also put down what you would spend if you weren't making sacrifices to pay creditors.

If you know Excel, make yourself a spreadsheet and start plugging things in - the total will surprise you - I know it did me !

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Thanks! I am in Nashville, too! Is there a lawyer here you know of that you'd recommend?

I will check out the site you left the link for.

I do know Excel and have started on my expenses spreadsheet. Do I need to show everything for the past 2 years or is 1 year sufficient?

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I would just use the past year, it should be enough to give you a good reference. If you haven't had any car repairs in the last year, throw some $$ into that category as a 'just in case'.

AS for Nashville lawyers.. one of the lawyers on that site used to be a Trustee.. I'm going to be calling that one first.

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Thanks for the pointers. I'm wondering how much proof one has to have of an expense. For example, if you list Christmas gift expenses, do you need to have the receipts?

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No, you don't. You put in what is 'normal' for what you typically spend. I have a large family.. easy for me to probaby get away with 300-500 in Christmas gifts, but if you've got a small family, that would be hard to justify. I don't spend all that money at once, I usually pick up things starting in Aug or Sept to spread it out as I can.

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No, and I'm not sure I'd trust a paralegal to do it. It's only $200 to file yourself and a lawyer to do the paperwork is less risky and will most likely let you make payments for his fees.

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