Anyone switch from 7 to 13?

[Help!]

Had the 341 hearing the day before yesterday. We were absolutely grilled because our income is high but the lawyer said we met the means test. We then received a six page list of documents that the US Trustee needs. It will be almost impossible for me to find all receipts for the past year that equal what we have on each line of the means test.

For those who have been through the Ch 13 process, can you take a moment to answer these questions? My lawyer is not a reliable source for information so I really need your help!

(1) Did you have to provide similar documentation, essentially accounting for every dime of every dollar that crossed your hands for the past year?
(2) After the payment plan is set up, is every transaction scrutinized and do you have to submit every bank statement?
(3) Is the budget enforced, i.e., do you have to show how much you spent on food, how much you spent on clothing, etc.?
(4) What if you get a raise at your job? Do you have to disclose this immediately and do they take your entire raise and give it to your creditors?

The main reason I am filing Ch 7 is the emotional burden of having this nightmare go on for another 5 years! What is it like to live with Ch 13?

[kmb]

We are almost one year into our Chp 13, so I'll try and answer your questions the best that I can.

1. We did not have to account for every dime we spent for the past year. There were some categories that fell outside the normal range that we had to account for, such as daycare costs and transportation (we live in the Chicago suburbs but commute to the city so in addition to car pymts and gas, we also have train tix and parking), but other than that we just took an average for food, utilities, etc and used those numbers.

2. & 3. We have never been asked to provide any additional documentation since we've been confirmed (which was in Nov.) The trustee went through our paperwork with a fine tooth comb, but our budget is ours, and we use it as we need to. We have a little built in so that we can put some money away each month, which I would highly advise that you do, since things happen all the time. Since we've been in the plan, we've had to replace our garage door opener and springs, our hot water heater and come up with a $1000 insurance deductible when a frozen pipe broke. Had I not been able to stash a little money away each month, it would have been disasterous.

4. My husband recently started a new job and received a pay increase. We contacted our attorney who told us that we did not need to contact the trustee--the only time we have to contact him is if we move. We expect our disposable income to continue to rise, as we will eventually have cars that are paid off and our daycare costs will get cheaper as our kids get older. We did have to negotiate a bit and we have a few double payments to make at the end of our plan, but by then we'll be able to afford to make them without having car payments, child support payments and daycare costs.

We didn't even try the Chp 7 route for two reasons--1. we have a house that we wanted to keep and were current on the payments and 2. our attorney really took one look at our income and said there was no way that we would get approved for Chp 7. Honestly, it hasn't been all that bad. Other than our statements from the trustee every 6 months, I haven't heard a word from him. Our attorney told us we could keep our tax refund (but we didn't get one) and our stimulus payment (we're still waiting for it).

If I can give you any advice though, it would be to make sure that you include EVERYTHING in your budget. Car maintenance, home maintenance, gas at $4/gallon, dry cleaning, haircuts, clothing and anything else you can think of!!! This way, if you don't need to use every dime each month, you can put some money away for emergencies. While I have had to get more careful about the money I spend, I don't feel that my lifestyle has changed drastically since we've been in Chp 13. And while it would be nice to have everything discharged in 6 months under Chp 7 vs. 5 years under Chp 13, I personally wasn't willing to sell my house or my cars, knowing that it would be a very long time before I would be able to get something comparable again in the future.

Good luck to you whatever route you go!

[MomIcantFindmy]

First off....relax. I would not convert to a 13 unless you risk having your BK thrown out. You will know if that is going to happen. Find the paperwork that the trustee is requesting and make a list of the items you are unable to locate with explanations as to why. Remember you have the protection of the stay right now. Good luck and keep us posted!

[Scott50]

I'm four months in my five year Chapter 13 plan- its NOT the end of the world.. My confirmed monthly payment amount came out to $100 less a month than orginally proposed. Sure it would have been nice to have the magic wand erease all my debt and have a "fresh start" in a Chapter 7.. I'll have to learn to live without plastic for the next 4 3/4 years..