Bankruptcy Case Study For Daniel G., From Geneva, Illinois.

Bankruptcy Case Study

This is the bankruptcy case study for Daniel G., From Geneva, Illinois. Daniel is in the office to determine whether or not he can file a chapter 7 bankruptcy case as he filed a chapter 7 bankruptcy case 10 years ago and he wants to see if he can get the same result once again. He does not own any real estate as he is renting on a month-to-month lease. He has a 2010 Nissan Sentra and the vehicle is financed by Capital One Finance. The current value of the vehicle is 15,000 and the outstanding debt is 14,000. He pays $309 per month and he is current on that vehicle. In terms of personal property, he has a checking account at TCF bank with a balance of $30, household goods valued at $1000, clothing valued at $500, and no other assets whatsoever.

Daniel is single with no dependent children. He is currently working in Des Plaines, Illinois as a dental tech earning approximately $26,000 per year. His net take-home pay after taxes is $1600 per month. Moving to his monthly expenses, he spends $430 per month for rent. His cellular phone bill is $80 per month. His food bill is $450 per month, his clothing bill is $20 per month, his recreation is $100 per month, his transportation cost is $320 per month, and his auto payment is $309 per month. He has earned approximately $28,000 in each of the last three years. He has not received any unemployment. He has not been sued or had any vehicle repossessed. He has not closed a bank account in the last year, he is not lived at any other address in the last three years, he has not sold or transferred any real estate and has not owned a business in the last four years. In terms of debt he has an income tax debt of $1200 from 2011. He has credit card debt totaling $5000, medical debt totaling $60,000, personal loans totaling $5000 and parking tickets at $800.

My recommendation for Daniel would be to file a chapter 7 bankruptcy as he has in the past. He can eliminate the credit card debt, the medical debt and the personal loans very easily by filing chapter 7 bankruptcy. His IRS debt and his parking ticket debt will survive the bankruptcy, however, those debts are relatively insignificant compared to his other debt that we will eliminate. Daniel does not have the ability to reorganize under chapter 13 because his income does not exceed his expenses. He is simply balancing out each month without even taking into consideration the minimum payments due on the credit cards. Thus, chapter 7 bankruptcy for Daniel G., of Geneva, Illinois would be my strong recommendation.

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