context: Some courts use the term "deficit spending" to describe debtors who are living beyond their means and suggest that substantial abuse is indicated anytime a debtor exhibits "deficit spending." These courts reason that substantial abuse exists anytime a debtor's expenses exceed income on the statement of income and expenses, for two reasons: (1) a debtor should live within means by spending only that earned each month and (2) because one cannot spend more than earnings, "deficit spending" indicates that the debtor is misrepresenting the financial picture to the court.
citation_a.signal: see
citation_a.parenthetical: substantial abuse indicated where the debtors, in their statement of income and expenses, described monthly expenses which exceeded their net monthly income by $1,364
citation_a.sentence: See In re Wray, 136 B.R. 122 (Bankr.W.D.Pa.1992) (substantial abuse indicated where the debtors, in their statement of income and expenses, described monthly expenses which exceeded their net monthly income by $1,364); In re Cook, 110 B.R. 544 (Bankr.N.D.Okl.1990) (substantial abuse indicated where the debtors’ statement of income and expenses showed more monthly expenses than monthly income); In re Roth, 108 B.R. 78 (Bankr.W.D.Pa.1989) (substantial abuse indicted where the debtors had spent substantially more than they earned during the two years preceding bankruptcy); In re Hudson, 64 B.R. 73 (Bankr.N.D.Ohio 1986) (substantial abuse indicated where the expense figures on the debtor’s statement of income and expenses exceeded the income figures, indicating "deficit spending”).
citation_b.signal: but see
citation_b.parenthetical: substantial abuse not indicated where the debtors monthly expenses exceeded their monthly income
citation_b.sentence: But see In re Tefertiller, 104 B.R. 513 (Bankr.N.D.Ga.1989) (substantial abuse not indicated where the debtors monthly expenses exceeded their monthly income).