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New here & my chapter 13 journey

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    New here & my chapter 13 journey

    I'm new here and I wanted somewhere that I could kind of journal/vent my thoughts, progress, and results. I am here because we are going to be filing chapter 13 soon, well Jan 3,2022 it looks like. I thought if I establish my story it might help someone else in the future with the caveat (any information I put forth is experience with MY situation and my current state AZ so it may not apply directly to anyone else) the few discussions I did locate around the internet did help me in some capacity usually spurring questions to ask my attorney.

    First, let me say coming to the decision to file a 13 is not an easy one as most people will always steer to a 7 & believe me if I could, I would but ours is necessity for a few reasons: income; house; car etc... I began looking for an attorney the first week in October after realizing I couldn't do this any more. Unlike a lot of people, I did not do any pre bk planning so everything up to my initial attorney contacts had been paid except mortgage which has been in forbearance since 12/20. I kept pushing off the inevitable which was that forbearance will end this dec & they want 37K chunk all at once. My first thought was to wait until nov then contact them to see what arrangements we could do but I realized that first week in Oct that they were unlikely to do anything much so I hunted attorney's. After speaking with about 6 of them a few things became clear: our home may cause the biggest issue with equity because 5 of the attorney's kept pushing the "value" from Zillow which I know is crap even in good times. Finally the last one I spoke to & I hired actually told me he agreed that it was crap & gave me options to prove it. The equity value was the crux of our filing because AZ current homestead exemption is 150K and zillow was reporting to where our equity would be about 254K. Now in Jan 22 AZ exemption increases to 250K so when we could file hinges on the true market value of the house. Now me being me, I went on my own and hired an appraiser thinking there is nothing better to show value. House was appraised 10/12 and we are just waiting on the report now which is supposed to get to me NLT 10/19. After we got the report, it was better but was still 26K over exemption so after speaking with attorney we decided on Jan 3rd. He has been quite good and has been steering us in the direction to best help us. He told us if we ever wanted a 2nd car that now is the time so we did that this weekend and got ourselves a brand new car with massive warranties & maintenance service. We picked the cheapest car but it was good enough for our needs.

    Now in AZ everything is paid through trustee: arrears, mortgage payment, and car payments which is fine with me means I can't screw up anything lol also means our ch 13 will look crazy compared to others. I won't know our payment amount until probably December but my atty is going to give us an estimated one (subject to change)in December we can sit down with our atty and hash out a plan. I am predicting in the ballpark of 4-5K/mo. So I will update this as we move further in the process. Like I said this will serve as my journal/log of events so feel free to ask me anything.

    #2
    Thanks for sharing your experiences with us, and please, keep us posted on your progress.
    Latent car nut.

    Comment


      #3
      Will do as I'm sure it won't be a smooth ride lol

      Comment


        #4
        You are lucky that you can exempt 150,000 in your home. Here in GA, it is 43,000 and only if one person owns an interest. It's really kinda messed up. We are a in creditors state and consumers get the shaft.

        I am filing this week so you are not alone.
        Last edited by womanonfire; 10-26-2021, 11:37 AM.

        Comment


          #5
          Originally posted by womanonfire View Post
          You are lucky that you can exempt 150,000 in your home. Here in GA, it is 43,000 and only if one person owns an interest. It's really kinda messed up. We are a in creditors state and consumers get the shaft.

          I am filing this week so you are not alone.
          we can track each other's progress & obstacles along the way.

          Comment


          • womanonfire
            womanonfire commented
            Editing a comment
            I actually did not file yet. Loan servicer cancelled foreclosure and then rescheduled it so we're filing 1st week in December.

          • Clambert1273
            Clambert1273 commented
            Editing a comment
            womanonfire Then we will be really close to each other's dates since ours will be Jan 3

          #6
          Only things for this week happening are, we took some major cuts expense wise for our budget which we needed to do anyway!

          Comment


            #7
            Welcome to BK forum it sounds like you did some good planning and are on the right track. It's great the attorney suggested getting a car. I wish we would have known to do that. Or at least realize that our old car probably would not last 5 yrs. My husband and I are car sharing and might have to keep doing that until the end of our BK especially now with the poor market to find cars, at least in our area. Then our young adult daughter bought a car and we took hers, but that one bit the dust. It is actually in my name and wasn't paid off! It sits in our drive way.

            We are finishing up week 43 this month (out of 60).
            I am not an expert. I just share my experiences in the Wonderful Wacky World of Chapter 13!

            Comment


              #8
              Originally posted by Carmella View Post
              Welcome to BK forum it sounds like you did some good planning and are on the right track. It's great the attorney suggested getting a car. I wish we would have known to do that. Or at least realize that our old car probably would not last 5 yrs. My husband and I are car sharing and might have to keep doing that until the end of our BK especially now with the poor market to find cars, at least in our area. Then our young adult daughter bought a car and we took hers, but that one bit the dust. It is actually in my name and wasn't paid off! It sits in our drive way.

              We are finishing up week 43 this month (out of 60).
              we lived on one car for over 4 years so it was time. Sorry about ur car and market. I think finding the new one was a much easier experience than used (even from our last one in 2017). We walked in told them what we wanted, drove it, signed, and went home.

              Comment


                #9
                Clambert1273 you know my pain of car sharing! I might moan about it, but am I happy that our jobs allow the flexibility to car share. I drive my husband to work go to my job, then leave my job pick him up and then go back to work and our jobs are fairly close together. It's almost like an extended lunch break it takes me usually 60 to 75 mins to pick him up, go home and then get back to work.

                One of the huge reasons we are putting it off is to avoid dealing with the process which includes writing a plan on how we can pay/afford it and then the attorney has to take it to the trustee and to court to approve and before we do that we have to find a lender who will give us a loan. The car dealership we have used since 2002 does have someone who works with bad credit/BK so it could happen. The process is very intimidating so we might just stick this out for the next 17 months plus however long it takes for the BK to be totally done.

                Or maybe next summer when we see the light at the end of the tunnel we might go for it!
                I am not an expert. I just share my experiences in the Wonderful Wacky World of Chapter 13!

                Comment


                  #10
                  Originally posted by Carmella View Post
                  Clambert1273 you know my pain of car sharing! I might moan about it, but am I happy that our jobs allow the flexibility to car share. I drive my husband to work go to my job, then leave my job pick him up and then go back to work and our jobs are fairly close together. It's almost like an extended lunch break it takes me usually 60 to 75 mins to pick him up, go home and then get back to work.

                  One of the huge reasons we are putting it off is to avoid dealing with the process which includes writing a plan on how we can pay/afford it and then the attorney has to take it to the trustee and to court to approve and before we do that we have to find a lender who will give us a loan. The car dealership we have used since 2002 does have someone who works with bad credit/BK so it could happen. The process is very intimidating so we might just stick this out for the next 17 months plus however long it takes for the BK to be totally done.

                  Or maybe next summer when we see the light at the end of the tunnel we might go for it!
                  I agree on the waiting, we only did it now because he recommended us to but now I am glad I did. I have worked from home since 2016 so a car is not necessity for me but it is nice to know I can go somewhere if I want while my husband is at work in the evenings or if my high school daughter has a function.

                  Comment


                    #11
                    Clambert1273

                    Are you filing just because of the forbearance arrears? Or is there credit card debt or other unsecured debt out there?

                    Comment


                      #12
                      Originally posted by flashoflight View Post
                      Clambert1273

                      Are you filing just because of the forbearance arrears? Or is there credit card debt or other unsecured debt out there?
                      mostly the house but there is some unsecured unless you count my massive student loans which don't matter in this much. I have never had much in credit cards (at least not enough to cause problems).

                      Comment


                        #13
                        Originally posted by Clambert1273 View Post

                        mostly the house but there is some unsecured unless you count my massive student loans which don't matter in this much. I have never had much in credit cards (at least not enough to cause problems).
                        If this is a covid forbearance, why don't you try to work it out with your mortgage lender. Most people are able to get a deferral or partial claim on their arrears easily as long as it's a government mortgage (FHA, Fannie, etc.) and you can afford the original mortgage payment. The federal government is making triple sure that the foreclosure crisis of 2009-2012 doesn't repeat itself so they are making it easy for borrowers to kick the arrears to the end of the loan. They're even making it easier to get a loan modification with low or no docs if you can't afford the original mortgage payment by a few hundred bucks. Very, very few houses are going to foreclosure. Foreclosures are mostly houses that had arrears prior to the start of the pandemic (March 2020). Beginning of November is the right time to call your lender and cut a deal with your lender to get a deferral or partial claim and move on before end of December.

                        If you do the bankruptcy, there is no option that allows you to reduce your payment and still keep your house. In fact your payment will go up by a lot due to the arrears. Bankruptcy has a lot of expenses too that will get added to the arrears. The covid forbearances are no cost and could even reduce your payment by a little bit.

                        Comment


                        • Clambert1273
                          Clambert1273 commented
                          Editing a comment
                          Thank you for all this info. I stewed a bit on it & called my mortgage co. They did exactly as u described & offered partial claim, so we took it and resume normal payments Jan 1. Now going to check with attorney about possibly doing a 7.

                        • flashoflight
                          flashoflight commented
                          Editing a comment
                          Why benefit does the 7 give you if you got the partial claim? You said you didn't have much credit card debt and you can't BK the student loans.

                        • Clambert1273
                          Clambert1273 commented
                          Editing a comment
                          While I don't have much cc debt, we do have personal loans so we do have unsecured debt that didn't help the situation.

                        #14
                        Originally posted by flashoflight View Post

                        If this is a covid forbearance, why don't you try to work it out with your mortgage lender. Most people are able to get a deferral or partial claim on their arrears easily as long as it's a government mortgage (FHA, Fannie, etc.) and you can afford the original mortgage payment. The federal government is making triple sure that the foreclosure crisis of 2009-2012 doesn't repeat itself so they are making it easy for borrowers to kick the arrears to the end of the loan. They're even making it easier to get a loan modification with low or no docs if you can't afford the original mortgage payment by a few hundred bucks. Very, very few houses are going to foreclosure. Foreclosures are mostly houses that had arrears prior to the start of the pandemic (March 2020). Beginning of November is the right time to call your lender and cut a deal with your lender to get a deferral or partial claim and move on before end of December.

                        If you do the bankruptcy, there is no option that allows you to reduce your payment and still keep your house. In fact your payment will go up by a lot due to the arrears. Bankruptcy has a lot of expenses too that will get added to the arrears. The covid forbearances are no cost and could even reduce your payment by a little bit.

                        I did try & ask and our loan is a VA loan. Before we even went to forbearance, I was contacting them and forbearance was the only option they gave so we took it. Sadly this was pretty much my last option & I really am alright with it.

                        Comment


                          #15
                          Originally posted by Clambert1273 View Post


                          I did try & ask and our loan is a VA loan. Before we even went to forbearance, I was contacting them and forbearance was the only option they gave so we took it. Sadly this was pretty much my last option & I really am alright with it.
                          The way it works is you ask for forbearance at the beginning and they give it to you. You got past that part. So far so good.

                          When you get close to the end like right now, you have to call the lender and tell the your hardship is over, you can afford the original payment, but you can't pay one penny extra beyond that. Then they will offer you a partial claim and you accept because you told them you cannot pay anything towards the arrears. Partial claim means your arrears are postponed until the end of the mortgage and life goes on with the original payment amount. It's just about guaranteed they will offer you partial claim as long as you say the magic words "hardship over, can afford original payment, can't pay a penny more than that".

                          If you can't afford the original mortgage payment or a few hundred below that via the covid forbearance loan mod, then nothing is going to allow you to keep the house. Bankruptcy doesn't have any way to give you a big payment reduction and let you stay in the house at the same time.

                          Comment

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