Chapter 7 Bankruptcy Case Study For March, 2016

This is the chapter 7 bankruptcy case study for Ms. G., who resides in Chicago, Illinois. We are here to examine whether or not Ms. G. can qualify and benefit from a chapter 7 bankruptcy filing. Let’s examine the facts of her case: she is currently residing in Chicago and she is renting. Her rental arrangement is month-to-month and her landlord lives in the very same building. She owns a 2007 Dodge Nitro which is financed by Honor Finance. The monthly payment on the vehicle is $342, her outstanding balance is $6,090 and she is current on the payment and would like to keep it. She also has a second vehicle, a 2004 Ford Explorer which is paid in full. We value that vehicle at approximately $3000.

In terms of property and assets, the debtor has a checking account at Chase Bank with an approximate balance of $50. She also has a security deposit on hand with her landlord of $825. Her household goods, TV, furniture, jewelry and electronics are valued at $1000. She has normal wearing apparel and minor clothing valued at $200. She is expecting a tax refund in the amount of $4000 which could be coming any day now. In terms of her description of household, she is single with two dependent children ages four and six.

In terms of employment, she is working as a housecleaner and has been working in that capacity for the past six months. She is earning approximately $2000 per month. Looking at her monthly expenses: she pays $825 for rent, $100 for water, $186 for cell phone, $80 for cable TV, $70 for Internet, $200 for food, $150 for clothing, $100 for laundry, $15 for medical, $100 for transportation, $40 for recreation, $176 for auto insurance, $342 for her auto and $75 for her son.

In terms of financial affairs, she has made approximately $3000 so far this year. In the prior year she made $41,000 and the year before that approximately $30,000. She has closed a checking account in the last year with an approximate balance of $300. She had a prior address within the last two years. In fact she was living out-of-state in Charleston, South Carolina from 2003 through 2014. She also had a business where she was a franchisee of a janitorial service. She has no co-signers on her debts, she has no student loans and she has no tax debt

Her debt is basically consumer credit card debt totaling $43,000. She also has medical debt of approximately $2800. There is one other debt which is in collection for $13,000 based on a personal loan. When we examine the totality of the circumstances, it appears that Ms. G. would benefit from a chapter 7 bankruptcy filing. She would be able to eliminate her miscellaneous unsecured debt while keeping her vehicle provided she continues to make monthly payments of $342 per month. The chapter 7 will require one court date and possibly one reaffirmation agreement hearing. Thus, my strong recommendation for Ms. G. from Chicago, Illinois would be a chapter 7 fresh start bankruptcy filing.

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