Prospect Heights Bankruptcy Lawyer’s Case Review

Mr. & Mrs. Mahed live in Prospect Heights, Illinois which is located within Cook County.  They are considering filing a joint bankruptcy.  Their fact situation is as follows:  They have 2 minor children.  They own 2 properties, with one with one mortgage that they live in.  They are current with their mortgage on this home.  The second property has one mortgage, and a line of credit.  They are current with this home also.  This home has an association fee.  It also has a renter that is current on his rent.  They also own 2 vehicles that are paid in full with average miles for the cars.  As far as property and assets, they have a checking and savings account, and an S-Corporation business. 

Both debtors are currently working.  One works as a night manager and one as a pharmacy tech.  Their income comes from both jobs and rental income.  At the moment, the business is running at a loss.  For their monthly expenses, Mortgage, (for both homes) (property taxes included), association and utilities are about $3,260.00.  The food, clothing laundry, cleaning, medical & dental out of pocket expenses are about $695.00.  The gasoline tolls, mass transit, automobile, and homeowners insurance are about $590.00. 

Their personal debt is about $75,000.00 to $80,000.00.  Their business debt is about $15,000.00 with a $50,000.00 loan.  Their ability to get a fresh start is dependent on a number of different factors.  The primary factor is what amount of equity is available from their homes?  If there is significant equity, the Chapter 7 trustee would attempt to sell either one or both of the homes for the benefit of creditors.  The Mahed’s would have to obtain an appraisal or fair market valuation for each of the properties before a final legal opinion could be given.