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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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If I have a mortgage for $279,000 and a HE for $100,000 and

Resolved Question:

If I have a mortgage for $279,000 and a HE for $100,000 and credit card and mother misc. debt totaling $100,000, how much would I have to pay per month in a bankruptcy
Chapter 13. Is there any way of calculating that?
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 6 years ago.

Hi JACustomer,

1) How many are in your household?

2) What is the total household monthly gross income?

Customer: replied 6 years ago.

One, just me, in the household.

Monthly gross income is about $3,000, although it changes monthly. Last month I only made $1,400, but the month before I made $3,000. I've been told by my boss that things don't look good for the near future. Our work has been declining for the past couple of years. I've been lucky that people who have owed me money for work that I did a couple of years ago are now paying me which is why, I think, I'm getting checks that are in the $3,000 range. I don't know how long that will last. I spent the last 30 years taking care of my mother who had Alzheimers which is why my credit cards got so high. But there was no way I would put her in a nursing home. She was too good to us kids growing up, it was the least I could do for her.

Expert:  cfortunato replied 6 years ago.

Last questions - what is the current market value of your home?

How much is your mortgage payment?

How much is your HE payment?

Customer: replied 6 years ago.

Unfortunately the market value is $115,000 right now.

Mortgage payment is $1,900.

HE payment is $685

Expert:  cfortunato replied 6 years ago.

Since the value of your home is less than the balance of the first mortgage, the HE loan will be treated as an unsecured loan.

Your monthly Chapter 13 payment will be your disposable income, which you will have to pay each month for 3 years. At the end of the 3 years, the balance of the HE loan can be discharged, along with the rest of your unsecured debts.

Your monthly payment - your disposable income - will be your gross income minus allowable expenses, such as your first mortgage payment, living expenses, car expenses, etc. Whatever is left - regardless of how much - is what is paid to the Bankrutpcy court.


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

Thank you!



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Customer: replied 6 years ago.
I meant to ask you this. I'm 62 now. If I take early retirement is the bankruptcy court allowed to take that as part of my disposale income? Because even if I do file for early retirement I will still have to work in order to make ends meet.
Expert:  cfortunato replied 6 years ago.

Thank you for accepting my answer! And thank you for the bonus!

Yes - for determining the Chapter 13 monthly payment, the Bankrutpcy court takes into account all of your income, including retirement income.

Customer: replied 6 years ago.
One more question. Would my pay check go directly to the bankruptcy court and they would send me the left over money?
Expert:  cfortunato replied 6 years ago.
That is your decision. You can set it up so that your employer sends your monthly payment to the Bankruptcy court, and the balance to you. Or you can just continue to receive your entire paycheck, and you would then send the payment to the Bankruptcy court.
Customer: replied 6 years ago.

Sorry to hold you up but I have two more questions. 1. If I filed a Chapter 7 instead of the 13 and gave up my house would I still be paying the bankruptcy court for years? 2. I am Power of Attorney for my brother and I have joint accounts with him. Is this going to be in jeopardy?

Expert:  cfortunato replied 6 years ago.

Does the money in the joint accounts belong to both of you, or only to your brother?

Customer: replied 6 years ago.
Well, it's in both of our names, but only under his SS#. It's his money, not mine. He's not incompetent, he's just forgetful. He'll leave bills unpaid on his kitchen table for months without even opening them and he has plenty of money to pay them.
Expert:  cfortunato replied 6 years ago.

1) If you file a Chapter 7 instead, you would have no monthly payments at all, and the entire process would take only around 6 months instead of 3 years.

2) If the money belongs to your brother only, even though the accounts are also in your name, the money in those accounts cannot be touched by the Bankruptcy court.

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