What happens after a chapter 7?

[Rozi]

Hello!

I have a question... I filed for Chapter 7 in 2001 and I was in a house and a new car in 2004 without a problem. Now I am having to file Chapter 7 again because I can not afford my car and I have little other bills. Is there a big difference now when you file chapter 7 verses back in 2001? I am scared that I won't be able to get another car since I am giving mine back. I would need another car right after my discharge. Can anyone shine a light on this for me? I know the credit is tight out there but how tight is it? Thanks for all of your help. I just wantto reubuild my life back.

[Logan]

If it is only your car you're filing for II would rethink Chapter 7.

[Rozi]

Why do you think I should rethink Chapter 7?

[sh9730]

Because you are going to cause a lot less credit damage in the long term by just having them repo your car and then settle with them on the defiency if need be...You wont be able to file for CH7 again for 8 years....so if any unexpected medical emergency or anything come up you have no option.

Just deal with the stress of the repo and other credit cards if they are low amounts as you say.....there are other ways to solve those credit problems other than BK and with a lot less long term damage...

[Rozi]

Thank you for your response Shy! My only problem is if I let them repo it will I be able to get another car right away? I live in the country and I need a car to get from point A to B.

[kmattin]

Maybe you should check out debtors anonymous in your area. Sounds like you have a problem. You would wise to check this out.

[discouraged]

I don't want to be rude kmattin, but this forum is not for judging people. Things happen in life. When I bought my house in 2004, little did I know that I would lose my job in 2008. The whole economy stinks and we should be holding people up, not pulling them down.

Rozi - Do you have any savings for a used car? I bought one for 1500 5 years ago and although it's not the best looking in town, it does get me from point A to point B.

[kmattin]

I am not judging anyone. If this person filed chapter 7 and then jumps right back into debt and wants to file again, they did not learn anything from the experience. Debtors anonymous will help with that problem. Just some advice from someone who has been there.

[Logan]

Figure out how to get another car but don't declare BK over 1 car. Go buy a cheaper car then walkaway from the one you have.

[Rozi]

Thank you so much Discouraged for taking up with me. You are right life happens. I haven't had a raise in 3 years and prices are going up and my pay is getting lower and lower. Plus I just moved and I have to put down hefty deposits on eveything. I have a small savings account of 1000.00 but I am not sure if that is enough for a car. I would love to be able to pay my bills but I can't do it. It's gotten to the point that all I can think about is how to save my car and save my bills without filing. It's not possible.

[LadyInTheRed]

Rozi,

To answer your question, the biggest difference between filing a 7 now and before the new law is that you have to pass the means test to file and show that you do not have the ability to pay your creditors in a Chap 13. You can take the means test at http://www.legalconsumer.com/bankruptcy/nolo/

I agree that if your only debt is your car loan, filing BK again is probably not your best option. Even if you get that debt discharged, you are still going to have to figure out how to pay for another car and your bills. BK will not change the fact that your expenses are growing and your income is falling. $1,000 CAN buy a car. It won't be the car you want, but it will get you around. $1,000 can also be a significant down payment on a better used car with a payment lower than what you are currently paying. The interest rate may not be great, but you can probably find financing, especially if you do it before your current car is repossessed.

[LadyInTheRed]

Rozi, I just saw a couple of your other threads and think some of the info from there will be helpful here. You are paying just under $600 a month for a 4Runner worth $9K. You still owe $23K. It needs $2k in work. You do have credit card and other debt.

With that kind of deficiency, I can see why you would be considering a Chap 7. You might be able to cram down your loan to its current value in a Chap 7. Was this car you bought in 2004? If not, how long ago do it you buy it? Redemption is also an option. I don't know a lot about the details of cram downs and redemption because I filed a Chap 13 where those are not options. Try searching the forum.

Letting the car go and trying to settle on the deficiency may still be a better option. It's hard to know without having a more detailed picture of your debts, income and assets. If you consider settlement, make sure you take into account the tax liability you may have to pay on the difference between the deficiency and what you pay in settlement.

[APL]

I am not judging anyone. If this person filed chapter 7 and then jumps right back into debt and wants to file again, they did not learn anything from the experience. Debtors anonymous will help with that problem. Just some advice from someone who has been there.

I think it's unfair for you to assume, without knowing any of the OPs circumstances over the last decade, that they did not learn anything. 10 years is not necessaily "jumping right back into debt," and thy may have had a multitude of circumstances that brought them to this point.

Her situation may help those of us who never want to be in this nightmare a sceond time, and we should be here to help her without her feeling like people think she is being thought of as someone with some sort of problem (at least until if/when she chooses to disclose how she got here again.)

I think debtors anonymous is a great recommendation for perhaps all of us here - but it can be made in a more compassionate way.

I'm sure there must be otheres here who filed more than once, and the OPs post may help them. It may also help those of us who never want to file a second time.

Rozi, all i could suggest is trying to pay for the cheapest but reliable transportation you can without having to do it on credit (if that's possible). Good luck to you.

[Rozi]

Thank you APL! I couldn't have said it better. I do not want to file again and I am doing my best not to but 600.00 is a lot right now. That is my only problem is the car. My total debt is 37K. 23K of it is the car. I have learned a lot about the first time I filed bankruptcy and I never wanted to do it again. Now it looks like I have too and I am so depressed over it. I am current on everything but my car. I feel like crying because all of my credit that I have built up will be gone and I will have to start all over again unless I can reafirm my debt somehow and keep my accounts open but who knows. I just want to thank everyone for their help so far. I really enjoy these boards and I have learned alot.

[discouraged]

I ended up filing because I got laid off and couldn't keep up with the mortgage on my house. But, my car is a junker that I bought 5 years ago for $1500. Well, that junker has cost me some money (about 3000 in 5 years) but it was normal wear and tear for the age of the car. It still runs great. And no one is tempted to steal it.

I know many people who have newer/better cars but the payments are killing them.

Maybe if you traded in the one you have for a lower priced used car? I don't know. I paid mine in full with my income tax return so did not have a debt on it.

Sometimes I wish I had a better car, but this is life.