Chapter 13 failures?

[rrockinggramma]

most chapter 13's fail because life happens and no one can predict 5 years down the road. The other reason is because once filed, the phone calls stop and some of the stress goes away. After a few months, you begin to relax and see that payments are being made by the trustee. Then after a year or so, you begin to feel pretty confident that you could "just take care it" and be done with the trustee looking over your shoulder, so you start to think about buying out or dismissing. But many do not consider that once dismissed, the penalities and fees can be readded to all accounts that would have been assessed from day one.

Your budget is your key to success in a chapter 13. Although you can't plan for all of life happens stuff, you can at least live within your means at the beginning of the plan. Once your income and outflow match, then you can begin to think about the other stuff that could come along the way.

Some areas that need to be considered:

can my vehicle make it for 5 years (do not file with a car that already has 150,000 miles etc) get a newer one prior to filing

try to get the mechanicals on your house in working order. Things do break down but hopefully with some maintainance you can keep that dog at bay for a while.

Good luck to all of you. I send in my last payment on Friday!!!

[Flamingo]

Having been through a Chapter 13 and probably every issue that can almost arise from being in one as to major house repairs, vehicle repairs, inheritance issues, elderly ill parents and still raising children, the main reason a Chapter 13 will fail is the debtors not being able to adjust their lifestyle to accomodate the change that needs to take place to get through a Chapter 13. A Chapter 13 takes discipline but it has its rewards as I have discussed on here in numerous postings. We are two years beyond discharge and I still look back and wonder how we did it at times but one needs to learn to live by cash only, do without, shop discount, forget the vacations and splurges and don't whine when your friends can do something that you just can't afford to do. In the past, one would whip out the cash advance to go do it. You need to learn you can't and just cannot do so. If you learn from those changes, you will successfully get through the Chapter 13 and carry those new money habits with you beyond discharge to save you from future problems.

[krielly]

I couldn't agree more with the above 2 posts. We are 37 mos into a 60 mos plan, and I think SOOOOOOOO differently about money now, it's unbelievable.

I find it comes down to separating "wants" from "needs". Before I spend money I ask myself if this is really a "need", or is it a "want". Generally, if I don't need it, I don't buy it.

I know that previously I never really faced the fact that plastic was real money. If there was something I wanted, I used the cc and bought it. Now that I don't have that luxury anymore, I REALLY think before I spend.

I also have an emergency fund in the savings account. It's not as large as I'd like, but it's better than nothing, which I had before. If I end up raiding it for something unexpected, it's my FIRST priority to get the balance back up to where it was before.

It really is a good feeling when you start to change your spending habits. Tough at first, but looking back I realize how much money I was wasting in my old financial life.

It's tough, but it is doable. Good things come to those who wait. I'm "Waiting" another 23 mos for discharge

K

[Mary Irene]

I've noticed that everyone is negotiating now earlier than ever, and it's because they need cash bad. So I would give it a shot.

[MajorMike]

Do you have to report your extra income to the trustee?

Won't the trustee find out about it when you file your income taxes?

He doesnt ask for tax returns and the extra income we make is from doing surveys online. If you dont make more then $600 a year, you dont have to claim it. That's an extra $100 a month for us right there, and then we do mystery shopping and other things ( babysit ,whatever ) to make the extra money...

[MajorMike]

To expand on that... The ONLY way you can keep the cars is if you file 13, unless you have enough money to pay the full balance on the loan.. Once they demand that there is no negotiating.

You can reaffirm to keep your car in a 7.

[NowImDownInIt]

You can reaffirm to keep your car in a 7.

Not if you are behind in payments and they are already demanding the car or the balance...

[wanttobehappy57]

I just don't understand why this happened to me!

I don't understand what happened with my chapter 13. I work two jobs - one full-time, one part-time. My attorney kept reassuring me until the actual day of the chapter confirmation hearing that everything would be just fine. I was misled by him. He told me that in the beginning the best thing was to do wage attachment for the $300 that he was going to propose in the plan. I was fine with that.

Then before the finalization of the plan he told my husband and I that we should pay the car payment and the house payment to the trustee. That was fine too and once again my salary check was attached.

Needless to say yesterday was the hearing. Guess what? Someone screwed up and now we are $2600 in arrears!?!?!?! I don't understand and now I have to pay the court $140 more a month! HOW COULD THIS HAPPEN? The money was being taken out of my paycheck every single freaking month!

[Mary Irene]

I don't understand what happened with my chapter 13. I work two jobs - one full-time, one part-time. My attorney kept reassuring me until the actual day of the chapter confirmation hearing that everything would be just fine. I was misled by him. He told me that in the beginning the best thing was to do wage attachment for the $300 that he was going to propose in the plan. I was fine with that.

Then before the finalization of the plan he told my husband and I that we should pay the car payment and the house payment to the trustee. That was fine too and once again my salary check was attached.

Needless to say yesterday was the hearing. Guess what? Someone screwed up and now we are $2600 in arrears!?!?!?! I don't understand and now I have to pay the court $140 more a month! HOW COULD THIS HAPPEN? The money was being taken out of my paycheck every single freaking month!

Probably to make up for the things that were added to your Ch 13 which weren't being covered in the original $300. And those were the secured debts of your mortgage and car payment. If you made those payments, you need to show that to the court. Otherwise, you owe it.

[wanttobehappy57]

I did pay them but attorney says I have to pay again - really stinks!

Yes, I did make those payments and on time - in fact, I never made a late payment on either the house or the car until I had to start paying them to the trustee! Now I have to pay it double? Doesn't make sense, I feel I was misled by my attorney.

[NewHope]

I think the percent of completion is somewhere in the neighborhood of 30-35% Yes a 13 is hard....Would I do it again.....NO....If I knew then what I know now, I could have done it on my own. You see to me (My opinion)..A 13 is trying to teach you how to live off of less money, it pushes you to see what you can and cannot live with. Our 13 took more than 50% of our take home. $700-357.50= Opps one less beer to drink.

When we filed old law back in 2003...we were behind on our only car and a few small bills, had I done then what I have been doing now....I could have avoided it all together. I think the key to getting it done the right way the first time is money management, learn to control the dollar not let it control you. Now I know....

[IDKwhat2do]

He doesnt ask for tax returns and the extra income we make is from doing surveys online. If you dont make more then $600 a year, you dont have to claim it. That's an extra $100 a month for us right there, and then we do mystery shopping and other things ( babysit ,whatever ) to make the extra money.



Major Mike: $100/month $1200/year. Each. That limit applies if that is your TOTAL income. Even if you don't get a 1099 for it, you are supposed to claim it. Including babysit, puppymill, drugs or lawncare!

My trustee asks for tax returns and takes all tax refunds. It is wrong that we are all treated differently depending on where we live and what our taxpaying conscience allows.

[Nicollette]

Some areas that need to be considered:

can my vehicle make it for 5 years (do not file with a car that already has 150,000 miles etc) get a newer one prior to filing.


I wish I would have considered this before I put my current vehicle in my plan. I'm wanting to surrender it, but it's like my attorney doesn't want me to. The majority of what is owed in my plan is going to my car because alot of my creditors did not file claims to be paid. Can the creditor object to my surrendering of the vehicle?

[MajorMike]

Not if you are behind in payments and they are already demanding the car or the balance...

Oh ok, I am never behind in my secured debt.

[MajorMike]

If it isn't documented, I'm not claiming it. Why should I claim babysitting??? My friend has my wife watch her child 3x a week in the evening for 4 hours...The $100/mo is babysittng, surveys, focus groups and selling the papers I write online...I actually make way more then that some months.
I do ALOT online for side money. I've already talked to my tax guy and attorney....
This is why I dont get it when people say they need more for food....there are so many ways to make money online, it's sick. I've given many people links, info etc for free..but it's too much info and takes too much time. Many people here wont give me an email to send it. You can make up a free email from anywhere online. I decided against helping that way as its too frustrating.
To send links within the email system here is a pain. I'd rather send a mass email to all interested. Please dont ask, I'm not doing it anymore...sorry~

He doesnt ask for tax returns and the extra income we make is from doing surveys online. If you dont make more then $600 a year, you dont have to claim it. That's an extra $100 a month for us right there, and then we do mystery shopping and other things ( babysit ,whatever ) to make the extra money.



Major Mike: $100/month $1200/year. Each. That limit applies if that is your TOTAL income. Even if you don't get a 1099 for it, you are supposed to claim it. Including babysit, puppymill, drugs or lawncare!

My trustee asks for tax returns and takes all tax refunds. It is wrong that we are all treated differently depending on where we live and what our taxpaying conscience allows.