Chapter7 Bankruptcy Would Be Best

This is the case of Bill Keeler who lives on Austin Boulevard in Chicago, Illinois.  He is here for Chapter7 bankruptcy consultation.  He has never filed for bankruptcy before.  He is not a homeowner.  He is renting.  His landlord lives in Chicago and he is on a yearly lease which expires in May.  He has a 2010 Chevy Malibu which is financed through Allied Financial.  The balance owed is approximately $19,000 and the value is $15,000.  He is up to date on his payment at $426 per month.  Since there is no equity in the vehicle and he is up today, Chapter7 is looking good.

In terms of personal property, he has a checking account at Chase with less than $1000, minor household goods, minor clothing and he has a life insurance policy from work which is a death benefit only.  He is single with no dependent children.  He has been working for the last four years for a marketing company earning approximately $34,000 per year.  He is paid every other week and he brings in approximately $1800 net per month.

Going through his monthly expenses, his rent is $500 per month, his renters insurance is $16 per month, $180 per month covers his telephone and cable as he likes to bundle that; $100 for food which is very low, $20 a month for laundry and dry cleaning, $120 a month for transportation.  And then he’s got health insurance at $82, the auto payment of $426 and he is also paying a pretty high auto insurance of $345 per month because he says his mother’s car is on the same policy and he is paying it for her.

In terms of the Statement of Financial Affairs, during the last three years, he has earned anywhere from $31,000-$34,000 per year and he is on that same pace this year.  He has not had any lawsuits in the last year.  He has not had any property repossessed.  He has not closed any bank accounts in the last year.  He has been at his same address over two years, he has not own a business in the last four years.

In terms of co-debtors, he did cosign for a car with an Ernest, and Ernest is also responsible for Wells Fargo Bank so this is something were going to eliminate in the Chapter7.  He has $45,000 in student loans which will not be eliminated and $7000 in IRS debt which should be eliminated because it’s more than three years old.  In terms of the remaining debt, he has approximately $20,000 in credit card debt, $6000 in medical debt.

So my recommendation for bill would definitely be a Chapter7 fresh start, get out of the credit card debt, keep paying for the vehicle and get out of the debt on the cosigned auto.  So that’s my strong recommendation for Bill from Chicago, Illinois; a Chapter7 bankruptcy would be in your best interest.

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