Bankruptcy chapter 13 California

[OtisUsa]

California...I contacted a couple of lawyers and it came down to I will be filing chapter 13 and when the means test was done, it was clear that I had to do the chapter 13. I will be filing in the next week as I am gathering all the required information that will be needed by my attorney. He is charging me a total of $3500. over the long haul of 5 years with the trustee account. I have to pay the filing fee and another fee upfront and his immediate costs, total upfront costs $1350. to get this filed next week. #1 does $3500. sound about right for a chapter 13? I do not own a home and I have no children. I am filing backruptcy because I was mailed a huge lawsuit that went into judgment and I wanted to fight it but, it sounds like a lot of legal stuff has to happen and the best thing to do for me is just file the chapter 13, so I can get this over with. I never even knew what bankruptcy was until the other day.

I have some questions that I forgot to ask the attorney. #1 my vehicle has been paid off for 11 years and it is worth $5500. it has allot of problems right now and I actually was going to buy a new car before this happened. He said that it would be a good idea to go ahead and buy a new vehicle as my credit will be bad after the filing and I will be in this for a good 5 years. Also, a new car will help with my disposable monthly income as I have no house or children and he said my car will continue to breakdown and I would not have the means to fix it as the assessment will be much higher as I will have all this extra disposable income. He said if you were planning on already buying a car and you were preparing yourself financially for a new monthly payment, he said that you should absolutely buy that car. My question is if I go out and finance a new car and keep my other car for commuting to my job or when I can afford to fix it up, can I keep this car in the bankruptcy or will the trustee want to sell my old car off for equity since I hold the title free and clear? Is there a limit of how much a vehicle can be worth that you keep etc. that has been paid off for quite some time? I really love this car but, I wanted to give it a rest and fix it when I had the minimal financial means. Do I have to trade my vehicle in and use it for a downpayment? Or can I keep that old car of mine?

Now here is the next question....I did not pass the California means test for chapter 7 because I had to use the past 6 months of my paychecks as what was required, the problem with that is I had lots of overtime during this period. My job was going through a change and asked us all to voluntarily pitch in and of course overtime. I worked a ton of this. Now unfortunately I have to use that period of time. I can not hold off and wait 6 more months to file at a later date as this judgment was mailed to me and I was never ever served or even knew of it's existence and within 20 or so days it will mostly likely turn into a garnishment order as what has been told to me. My question is this,once I am assessed of what I will have to pay through a new budget that they will create for me and the assessment is done and that is what I will pay every month. Am I now NOT allowed to have any future economic prosperity in the next 5 years? What happens again, let's say 3 months from now or a year from now my employer asks me to work massive overtime again and I want to help with projects and by the way this company does NOToffer work time off but, they only offer money, can I do that? what happens if I change jobs and get a raise, and I am really worried about the overtime, because there is talk of it in the next three months again. I was also thinking it would be a way for me to also pay this off sooner than the 5 years and try to discharge like after 2 years vs. 5 years. Can I pay it down and apply to discharge sooner? I humbly appreciate your comments.

[bigun]

I'll tell you right now, if you can qualify for a Chapter 7 by waiting for your income to drop then, you should wait. So what if they garnish you for awhile. You'll be dollars ahead by waiting to qualify for a Chapter 7.
After priority debts {legal fees, taxes} secured debts like auto loans and then, you're living expenses are accounted for, all disposable income goes to unsecured creditors. If your income rises, it's conceivable the trustee will adjust your plan to account for this.
The only circumstance I'm aware of where the plancan be less than 60 months if, your debt is due to arreage to secured creditors and you get that cleaned up at 100% or, if your plan call for a 100% payback.
If you were not served and were unaware of the judgment, it may well be worth some legal fees to try and delay any execution until you have a chance to get your 6 month income down.
Also, what sort of disposable income do your schedules show? What percent will they be paid at?
Don't let fear stampede you into a wrong decision.

[OtisUsa]

Bigun,
Hi what awesome and I mean awesome advice. I have listened to you and I have calmed down. I even found the california bankruptcy means calculator at [url=http://www.legalconsumer.com]LegalConsumer.com :: Free Bankruptcy Information, Means Test Calculator, Exemption Laws,[/url]. What a fantastic site. This is the best. It is amazing what this calculator does. It figures all the stuff that the IRS has estimated, everything is factured in. You hit update and it is like built in software. Absolutely, incredible. I hope others read this, because they could factor their state, their county and it does the work for you. I work for the state of calif and how I benefited from using this is they take into account all my deductions from my employer. I make $4468. a month and they take almost $1600. of deductions like the taxes, retirement, union dues and so on. I really have nothing coming out of it, these are just standard deductions from my paycheck that they always have done, but the calculator figures all that out, your charitable contributions and the IRS deductions. When I took the calculator test twice for bankruptcy 7, it showed that I am even $100. under the $6000. amount. You know how it says you figure out your left over disposable income, then times that by 60 or 60 months and if that amount exceeds $6000, then you have to worry about qualifying. They go up to $10,000 but apparently some special circumstances. Anyway, I qualify and I factured in the IRS allowance for a monthly vehicle payment of $489. and I will go out and buy that car. I will wait 6 months and not work any overtime and then file. I also found the site for motion to set aside the default judgment and to contest that with my county court house. My lawyer had told me that we could delay it about 2 to 3 months with the motion to set aside. I was never served, notifyed, summoned or anything. NOTHING and that was so unfair and unjust. I think I was shell shocked from that. I think the lawyer said that they have to show some proof that I was served and so on. I think it is going to work out. I feel like 1,000,000 bricks have been eliminated. I don't even know you, but your paragraph that you wrote, caused me to stop and think, take a deep breath, pause and just chill. Then I went looking rationally on the internet for answers that I needed. I just want to thank you so much. You have made me incredibly happy just for your answer. May God always bless you. Otis.

[bigun]

I'm happy things are looking up for you. Bk is like many things in life. What you don't know can hurt you. Good luck going forward.