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cfortunato
cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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Here is my situation I was divorced a couple years ago,

Resolved Question:

Here is my situation:

I was divorced a couple years ago, wife got the house and the mortgage, and the second mortgage in the divorce. I just finally have discovered the mortgage and the second mortgage still have my name on them and they will not be removed. My name is XXXXX XXXXX house. So I now have about $500,000 of debt on my name with no asset to offset it at all.

Also, my exwife just did a mortgage modification because she can barely afford the payments. She has no intention of selling the house soon and when she does, it probably will not sell for enough to cover the mortgage and 2nd mortgage. There is a possibility she will end up filing for bankruptcy at some point.

Besides that I have:
minimal assets
Personal loan debt around $10,000

I also and the gaurantor of a small business credit card account with about $13000 of debt on it. That business is on the verge of bankruptcy.

So, I am thinking perhaps I should file Chapter 7. My goal would be get my name off the 2 enormous mortgage loans - since at any point my ex wife may file for bankrupcy plus these beasts make it impossible for me to ever get a loan for anything. I would hope to also clear the personal loan debt and remove my liabiity fromthe business credit card debts.

I have a solid job and same employer for past 11 years.
I would probably be interested in buying a house in perhaps 2 years.

What do you think? Is Chapter 7 a decent option for me?
Submitted: 2 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 2 years ago.
Hi JACustomer,
Chapter 7 Bankruptcy is an excellent option for anyone who is struggling to pay their bills, or who cannot pay their debts, and who does qualify to file.
To help determine this:
1) How many are currently in your household?
2) What is your gross monthly income?
3) Do you have to pay child support or alimony? If yes, how much do you have to pay per month?
Customer: replied 2 years ago.
1) I live with my girlfriend. She pays me for rent. But I think my household is still 1 right?
2) Gross monthly pay: About $5300
3) I pay $400 month in child support
Expert:  cfortunato replied 2 years ago.

Assuming your girlfriend contributes at least $369 to the household (you have a household of 2), you earn too much money to file a Chapter 7, where you would be able to have all debts discharged without having to pay anything.

However, you should be able to have your debts discharged by filing a Chapter 13 Bankruptcy - where you would have to pay all disposable income (gross income minus allowable expenses) to the Bankruptcy court for 5 years. At the end of the 5 years, the balance of your debts - including the mortgages - can be discharged.

 

I think this is what you wanted to know. If not, please let me know.
Thank you!

 

Customer: replied 2 years ago.
Since my girlfriend counts as a member of the household, does that mean her income also must be considered in the Means test so I can file bankruptcy?
Customer: replied 2 years ago.
Also, I just double checked my income numbers. My Gross income is actually more like: $4100/mo
Expert:  cfortunato replied 2 years ago.

1) What is your girlfriend's gross monthly income?

2) How much of her income does she contribute to the household (rent, food, utilities, etc.)?

Customer: replied 2 years ago.
1) My girlfriend makes $1590 per month
2) She pays $460 rent and utilities, and $400 a month for food so total $860/mo
Expert:  cfortunato replied 2 years ago.
Given the information you provided, you can gross up to $4,391 per month, and be able to file a Chapter 7 Bankruptcy. So - yes - you do qualify to file.
Customer: replied 2 years ago.
Great- it is an option. I suppose that is inherently part of my question.

But the question I really need answered from an expert:
Is Chapter 7 a decent choice for me? Is it a good idea based on my circumstances? I now know I can do it, but should I do it? What is your expert opinion?
Expert:  cfortunato replied 2 years ago.

I answered that question in the very beginning (my first sentence in my first reply), but here it is again, and in more detail: I think Bankruptcy is an excellent option and a great idea for anyone in your financial position. With a Bankruptcy, you can start over, and live a life without the stress of wondering what the mortgage companies are going to do.

If you do not file, and if your ex-wife stops paying the mortgages, the mortgage companies can get judgments against you. Those judgments can be used to garnish your wages and bank accounts, and to place liens on any property you own.

It is true that your credit score will decrease substantially once you file, but if you have no more negative credit activity, your credit score will start to improve in approximately one year after you file. Additionally, you will be able to get credit again (if you want) in about one year after you file, and you should be able to get a mortgage for a house in about 1 - 2 years after you file.

cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience: Bankruptcy professor.
cfortunato and 2 other Bankruptcy Law Specialists are ready to help you
Customer: replied 2 years ago.
Thanks. Your first answer seemed just like a standard cookie cutter reply- I wasn't even sure you read my particular details. All you said was:

"Chapter 7 Bankruptcy is an excellent option for anyone who is struggling to pay their bills, or who cannot pay their debts, and who does qualify to file."

I think you have now given me more detail specific to my unique situation. Thanks!
Expert:  cfortunato replied 2 years ago.
You're welcome! And thank you for accepting my answer!

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