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    #16
    Lately I have been thinking maybe I should not file. I don't have terrible debt compared to some that have shared their details on here.
    The worst of mine is about 10k in back taxes. All debts total 43k. Most will be taken care of in less than 5 years.
    The 3 steps I have taken so far are:
    Entered a gamblers treatment program, which is free in the state of Oregon.
    Set up an appointment with a psychartrist, which is not free anywhere!
    Consulted 2 bk attorneys. The first will be on vacation in 1 month, and wanted to hurriedly slam something together. He began some forms that do not even have the correct figures in them. He wanted a 600$ retainer, whiciach I instead put towards a mortgage payment I made today, 119 days late. The other attorney was booked for 2 weeks, and wants 40$ to consult, and discuss fees.

    I am just going late on cc bills and loan payments. I spoke to one loan holder, who told me the loan would be sold to a collector after 60 days late. I am just now 30 days.
    Would it be a good idea to let them peddle it, and negotiate with the collector?
    I have this 2300$ loan, and another 9500$ one that is current. These babies are around 30% interest. There is another loan for 2700$, a car loan for 8500$, and 6 cc's totaling 7000$

    Where can I find financial counseling as what to do and when to do it in my situation? What kind of counseling should I be looking for? CCC?

    The way I feel(especially after my attorney experience) is that I have not yet exhausted other avenues, and I should keep filing bk in reserve, in case a health crisis hits.
    I will have to tighten things up immensely under Ch13. I feel I should give it a try on my own, at least for the rest of this year.

    Comment


      #17
      Hi Scottowl,

      If you decide not to file, these creditors will sue you in court and this could potentially make things even worse for you if these debt are not resolved. I suggest seeking opinion by another BK lawyer or if you decide to seek financial counseling, you can look up in your area what is available. You mentioned in your post you are not retiring until at 66 years? Chapter 13 payment plans are between 3-5 years, depending on your financial situation.

      Regarding retirement, tackling debt is critical before retiring.

      Best of luck!
      Filed CH13 Winter of 2018; Confirmed Summer of 2018; 5 Year payment plan

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        #18
        I really don't know what to do. I can't decide. I don't even know if I have the ability to decide.
        That is part of the problem.
        Maybe it would be best to file. I have slightly more than 5 years left before I hit retirement age.

        I really do not care about credit score anymore. I really don't have a thing to show for all the years I worked, except a SMALL pension and whatever crumbs are left over from Social Security. Anything I save in 401k goes to this debt.

        The other day I was trying to remember what made me happy, and what things brought joy. There is nothing I could think of then, or now.
        The more I dwell, the more depressed I get.

        Comment


          #19
          Scottowl you are taking steps in the right direction!!! Try to stay focused on that.

          If you can find a bankruptcy attorney that has time soon you could at least get an opinion. $600 sounds like way too much unless you are actually hiring the attorney.

          I don't know a lot of about the credit cards, but I know what happened with us. The credit card companies will make payment plans with you and when they sell your debt to collections (it may even been collections within the credit card company) they will offer you a plan "pay this amount (less than what you owe) by such and such date" or "pay this payment plan" (which may also be lower). But you have to agree to it and have the money to do it when they ask. And they may send you a tax form which basically adds the amount you didn't pay as income making your income higher and increased taxes.

          We were sued by a few credit card companies and it did take a long time. I want to say about a year, but I can't be for sure. We had to go to court and at that time the lawyer for the credit card companies try to feel you out and see if you will settle or refer you to call someone to set up a plan (they want to get something rather than nothing). Those lawyers were actually very nice and sympathetic. My bankruptcy attorney told us how to talk to them, what to say which was actually buying us more time. I did not tell them we were going to file, but told them we were exploring options. Some of the pretrials we had to go to court and some were done over the phone seems like one local courtroom judge would never do telephone conferences.

          Where will you be in 5 yrs--retirement age. If you file bankruptcy now you will be out of debt then. If you make payment plans to pay the creditors you wil have to come up with the money and pay them and in the end will you basically be in the same place? What I like about our Chapter 13 is that I don't have to deal with any bills (except mortgage and cars and utilities, etc--but no credit cards) and the interest DOES not accrue higher. My payroll sends my payment to the trustee. And no one can harass or call us about paying off any debt.

          It sounds weird, but I found it more peaceful/less stressful once we filed/got confirmed and got use to the fact that we had to do something we never thought we would do, feeling like we failed and the stigma. It sucks, but it was necessary and in the end we will be better off.

          Comment


            #20
            Originally posted by justbroke View Post
            Yes, but this is handled differently across the bankruptcy Districts. In most, you can either contribute or pay back a 401(k) loan. In others, they allow both. In some, they don't wnat you to have either a loan or contributions despite the clear language in the Chapter 13 code (as modified in 2005 by the BAPCPA) that Congress stated that contributions are "NOT" disposable income.

            Consistency is great because you can argue that a.) you have done this over the years and b.) you are nearing retirement. (The nearing retirement argument is a very strong argument anyhow). The maximum is typically the maximum "match" from your company. For example, if your company matches the first 6%, the Chapter 13 Trustees will usually not argue about contributing 6%. Anything over 10%, in general, will likely cause some issues with the Trustee. In all cases, everything is fact specific to the individual debtor.

            You're not that loud. LOL

            (For anyone reading, 401(k) contributions and loans can not be counted as an expense and are treated as disposable income in Chapter 7 cases. At least in the majority. In under-the-median income cases, the Chapter 7 Trustee and United States Trustee (UST) usually don't care about this because the debtor doesn't need to complete the entire Means Test anyhow.)
            The variability in how 401k contributions are handled with respect to disposable income calculations for Chapter 13 is one of the most frustrating and flawed aspects of Chapter 13 in my opinion (I'm not even going to go into allowances for pet expenses...that's a different animal (no pun intended ) but currently my #2 frustration). In fact, this is the primary concern for me with regard to my upcoming filing of Chapter 13 (I make too much for Chapter 7).

            I have researched and read just about every possible decision on this issue...and there are some really good case opinions out there....all dealing with the interpretation of the hanging paragraph in Sect. 541(b)(7). That's right, all this trouble is being caused by the interpretation of what Congress meant regarding a certain paragraph structure in the US Code.

            As of 2017 there are three general lines of reasoning (based on case files):
            - The "Johnson" approach where for which 401k contributions DO NOT count as disposable income and are protected essentially up to the IRS contribution limits;
            - The "Seafort" approach where a debtor can make contributions in the amount he/she made prior to filing;
            - and the "Prigge" view, which is the most strict and says voluntary contributions are included disposal income - period.

            Most courts are dismissing the Prigge view as overly strict....but again there is tremendous variability by district and be case and some districts are setting their own guidelines for contribution limits based on %payback in the Ch 13...or just cap it arbitrarilty at say 6% (although some are as high as 15% I hear).

            For a federal law such as bankruptcy there should not be such a difference...you should not be penalized by living in one district vs another I mean.

            I am not a lawyer but while going through this research I have personally studied the relevant sections in the US code..especially post BAPCPA and it is obvious to me that congress was indending to allow 401 contributions during Chapter 13 (that is 401k contributions were are not part of disposable income)

            Comment


              #21
              I would like to contribute the 15% max. I have a long history of contributing @8%, which is better than nothing.

              Today I received a formal fee agreement from attormey A, which includes most of his payment by the court. I have made the decision to file(I think!), but would surely like to know the payment amount to the court first.

              Is this as simple as dividing up the total debt over 60 months? I arrive at 200$ per week doing this and adding 10% for the trustee. Can the payment be even higher than that?

              I also need to make decisions about automobiles. I am limited in my ability to make decisions. I feel it is severe enough to be considered a mental handicap. I am alone in this world, and don't really have anyone to act as a sounding board. I really do some dumb stuff at times, which is how I got in this mess.

              Comment


                #22
                When we gave all our info the attorney complied the paperwork that would be given to the court. We got a copy of it to read over before we signed off.

                Ours is divided over pay periods so it's not 60 months its 130 payments (26 paychecks per year). If you get paid weekly and they take money from each check it would then be 260 payments. I don't know if it's figured out by simple division. Our plan is different, too, because we pay off a car during the last year of the plan and then they increasing our payment by $227 for the last 8 months or so (I don't remember exact date car is paid off), but I think they had to do it that way to get 100% paid off in 5 yrs.

                If you are paying back 100% the pay back will not be above 100%. The trustee wanted us to pay more because we had more disposable income than when we did the initial paperwork The attorney was able to prevent an increase based on the fact we are paying 100% If all the creditors do not file and you over pay my understanding is the overpayment is returned to you after discharge.

                Comment


                  #23
                  Originally posted by Scottowl View Post
                  I really don't know what to do. I can't decide. I don't even know if I have the ability to decide.
                  That is part of the problem.
                  Maybe it would be best to file. I have slightly more than 5 years left before I hit retirement age.

                  I really do not care about credit score anymore. I really don't have a thing to show for all the years I worked, except a SMALL pension and whatever crumbs are left over from Social Security. Anything I save in 401k goes to this debt.

                  The other day I was trying to remember what made me happy, and what things brought joy. There is nothing I could think of then, or now.
                  The more I dwell, the more depressed I get.
                  I have same situation. But as it turned out my credit score very important for me. Because i wanna get mortgage in this year and how statistics show, my credit score to low for what i want.

                  Comment


                    #24
                    Originally posted by justbroke View Post
                    This should be repeated. Please, everyone reading this, don't go into retirement in debt.
                    This was one of my primary motivations for filing BK in 2013: to clear out all debt before retirement, which right now is anywhere between two to 15 years away for me. And also before the kids head off to college as I don't like student loans. Then there's the unexpected major illness or other health issue and the debt that can bring on.
                    Filed Ch 13 November 2013, discharged March 2019
                    Credit Karma FICO scores 4 months post-discharge:
                    717 Trans Union/728 Equifax

                    Comment


                      #25
                      Originally posted by RickHarley View Post

                      I have same situation. But as it turned out my credit score very important for me. Because i wanna get mortgage in this year and how statistics show, my credit score to low for what i want.My friends advice me https://www.boostcredit101.com/
                      I wonna get car loans in this months.

                      Comment


                        #26
                        Yesterday I saw another lawyer who brought up ch 7, which I had not considered.
                        He recommended listing a family member as a household member
                        As it turns out, he only does Ch 7
                        I have made the decision to file Ch 13. I will pay the retainer next week.

                        I finally had my first counseling session about the gambling problem. The counselor said I would need an addiction specialist. She did have some ideas about limiting access to money. She also recommended I get a cashiers check for the retainer. I’m going on 2 months late on some accounts, and should not get past 3.

                        Two questions, as I told the lawyer I would ask no more until I pay him:

                        Can a judgement be thrown into the creditors pool, or it handled differently?

                        would I be able to keep 2 vehicles?

                        Also I have two cell phones on contract. Would I be able to get rid of those and do a pre paid card set up?

                        Oops, I guess that’s 3 !

                        Comment


                          #27
                          Congrats on making your decision and seeing the gambling counselor! Great steps in the right direction!

                          Remember I am not an expert, but here's my comments.

                          Cell phones they might put that into the Chapter 13 payment. I don't understand why, but my outstanding balance from Verizon was put into the plan. I was late on one payment because I was always running behind and then making the "promise to pay" that allows you to pay late. The monthly payments we had on the phones did not go into the Chapter 13. Maybe you have an option of putting the contracts into the payment. I don't think you'd have problems with the prepaid, we have one and pay it monthly. I have seen some that they want automatic payments set up which could be done through your bank or debit card.

                          We were able to keep 3 vehicles, but we had 3 people in the household and one of the vehicles was on it's last leg, two had payments. I think it might be possible, but that's something you have to work out with the attorney to see if if can be done.

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