Income Surplus
Does the Income Surplus take into account a person’s expenses? For example, let’s say that I make almost double what is allowed for a single person in take-home pay, however, my mortgage payment including taxes is about that same amount. Obviously my expenses are going to exceed the monthly limit. Does this mean I have to forfeit my residence?
No, unless these expenses are required to live (i.e. insulin for a diabetic) the way the court would react is that you have made a conscious decision to exceed a reasonable cost of living and the court will not prejudice the creditors for you choices. Therefore, the surplus calculation is based on what you make, not what you spend. Sometimes the result is that one may have to reconsider living arrangements so they can be able to cover the required surplus payment as well as cover all their other bills.