Bankruptcy Case Study For Gomez

This is the case of Guermo Gomez who comes to me from Franklin Park, Illinois seeking debt relief.  Mr. Gomez has never filed a bankruptcy before.  He does not own any real estate and he currently lives with his family.  He rents from his father on a month to month lease.  He does not own or operate a vehicle.  He has a checking and savings account with very little in it, minor household goods and very little in the way of clothing.  He does have a 401(k) which is protected in the amount of $20,000.
He is currently single but he does have for dependent children ages nine, five, four and three.  He has been working the past seven years as a driver for a grocery store earning approximately $77,000 per year; when we break that down per month, that’s about $3900 net in pocket per month.
In terms of monthly expenses, he’s got approximately $3900 as well.  That between the $800 in rent, $220 and cell phone, $1300 for food, $600 for clothing, $120 for laundry, $600 for transportation and $180 for auto insurance.  You have to remember, his food budget is very high because he has a lot of mouths to feed in his house with his minor children.
In terms of a Statement of Financial Affairs, he did have an auto that was repossessed a couple years back.  He did have a small business that he has no equity in and he’s not going to move forward with.  And he has not received any kind of unemployment or workers compensation.  There are no co-debtors.  He owes for no student loans and he owes no income tax debt.
Let’s talk about what Mr. Gomez does have and that is Pay Day loan s and credit cards of approximately $15,000.  Based on this situation, even though Mr. Gomez is making a fair amount of money, I would recommend a Chapter 7 fresh start to eliminate the credit card, stop the Pay Day loan  harassment and get back on his feet.  So Chapter 7, Mr. Gomez, that’s what I recommend for you in your particular situation.