Case Overview
This is the case of Gary Kaplan from St. Charles, Illinois. Mr. Kaplan filed a Chapter 7 bankruptcy back in 2001 so he is eligible to file another Chapter 7 should the facts dictate that he file. He has a townhouse that has a market value of $188,000 and he owes approximately $46,000 on a first mortgage and $181,000 on a second mortgage; so he is significantly underwater on the house. He has a 2009 Chevy Impala which is paid for. It’s got 100,000 miles on it and it’s in very poor condition. He also has a 2011 Honda CRV, although he claims that it’s in his wife’s name only.
Personal Property
In terms of personal property, he has got a checking and savings account at Chase and Citibank. Household goods totaling $1000, normal clothing $200, and he has term life insurance with a death benefit only. In terms of income, he is an investigator and he has been doing that for the last 11 years as well as a process server and he is earning approximately $3800 per month from all sources. When we look at his monthly expenses which include the first and second mortgage, the property tax, food, clothing, electricity, transportation, auto payments he’s got $4900 in monthly expenses. So Mr. Kaplan is significantly underwater with his real estate and he is underwater with what he is bringing in per month based on what he is spending per month.
Bankruptcy Attorney Recommendation
So for him, I would recommend a Chapter 7. He can get rid of $12,500 worth of unsecured creditors. He can get rid of some of his IRS debt since it’s more than three years old; however he will be stuck with the student loan debt through the Department of Education in the tune of $23,000. However, a Chapter 7 would definitely help Mr. Kaplan get back on his feet and rebound.
