Someone please give some advise on CH 13 possibility>>

[psa10]

First of all I live in AZ, have to admit I declared CH 7 in 2009, got a discharge and now four years later I'm in a worse situation. I assume I can file a 13 as long as I have stable income but my question is regarding recent use of payday loan companies. I have four PDL'S, one for $850, $685, $950 and $2,600 all at 180% interest. Totally my fault but now am having trouble paying. I have credit cards in the $7k ranage, all current, I owe $3500 to eBay/PayPal and $2,500 to Kabbage. Took out a refi on my car three months ago for $207 X 72, and a loan with Sprinleaf for $4k. I have changed my tax exemptions to 10 otherwise I can't pay my bills!

I know I really screwed up here but how long would I have to wait to declare a 13? Am thinking of getting a new job should I just take money from the 401 to cover? Someone please give me some advice, am really upset about this and the situation I got into. I assume I could keep the car in the 13 as long as I continue payments and whatever the 13 monthly payment. The day loans were taken out in the last 45 days or so.

[murph996]

I had a ton of payday loans. Dumbest thing I ever did. Are those loans from on-line lenders? Or from local lenders?

Regardless, I'd stop paying on those immediately. If they are online lenders, they are likely illegal. Sounds to me though that they are from storefronts since the interest is lower (yeah, really) than the illegal online loans. Not sure in Arizona, but in Ohio my lawyer wasn't concerned that some of the payday loans were paid relatively recently...he was prepared to argue that the initial loan was the origination date, not all the renewals. It never came up. In fact most of them never made a claim.

For me, once I stopped paying most of the lenders wanted to set up payments to pay back the amount owed and weren't adding interest and fees. I made some of those payments before I decided to file bankruptcy..but the key was to stop rolling over those loans. Having a huge some gone from my paycheck immediately snowballed to make my other issues even worse.

[ValleYum]

Psa? Will the Ch 13 solve your financial problem(s)? Are you trying to keep a house or other asset you truly can't afford?

Were you using these payday loans for living expenses or was there a financial crisis of some kind? Why I ask is that a BK won't solve the issue of too little income.

DO NOT take exempt retirement money to pay your unsecured debt! Leave your 401k alone! You will be in a pickle with the IRS with early withdrawal penalties if you pull out money before a certain age (59.5 - I think). Also, the 10 exemptions you are claiming on your W-4 may come back to haunt you, too.

I didn't file a 13 but I am sure other forum members will be along soon with more (and better) advice/answers. The forum is slow on the weekends so don't be discouraged if you don't see a reply today.

I wish you good luck!

[despritfreya]

. . I live in AZ. . . I declared CH 7 in 2009. . . I assume I can file a 13 as long as I have stable income. . . I have four PDL'S, one for $850, $685, $950 and $2,600 all at 180% interest. . . I have credit cards in the $7k range. . . I owe $3500 to eBay/PayPal and $2,500 to Kabbage. (I refied) my car three months ago for $207 X 72, and a loan with Sprinleaf for $4k. . . How long would I have to wait to declare a 13? Am thinking of getting a new job should I just take money from the 401 to cover?. . . I assume I could keep the car in the 13 as long as I continue payments and whatever the 13 monthly payment. The day loans were taken out in the last 45 days or so

You have approximately $22,000.00 of unsecured debt and a vehicle loan.

1. You are eligible for a Chapter 13 discharge if you file the Chapter thirteen 4 years after the date of the Chapter 7 discharge.

2. Payday loans are illegal in Arizona so don’t worry about them.

3. If you file a Chapter 13 the vehicle will be paid through the Chapter 13 Plan. Since you just refied, it should be paid in full over the life of the Plan.

4. Makes no sense to take money from an exempt asset (401K) to pay debt.

Set up several consultations with attnys to discuss your situation and stop stressing over it. Initial consultations are usually free.

Des.

[LadyInTheRed]

I have changed my tax exemptions to 10 otherwise I can't pay my bills!

Stop paying the payday loans and other unsecured debt and change your withholding back to where it should be! You are just multiplying your problems! Not only will you have big tax bill to pay in April, but you may be hit with a penalty for under withholding. In fact, depending on how long your exemptions were at 10, you may want to change it to zero to make up for the underpayments.

And to add to the chorus: Leave your 401k alone!

am really upset about this and the situation I got into.

Stop beating yourself up. Focus your energy on solving your current problems and adjusting your habits that got you into this mess for a second time. You can't change the past. But you can chose to not make the same mistakes again.

[psa10]

Thanks for all the feedback here.... I am going to work tomm and changing all tax forms over to zero deductions. Am also going to schedule an appointment with my local bk atty. The latest payday loan was taken about 30 days ago, I am current on everything at this point but am struggling. Here in AZ payday loans are actually called title loans however I assume the bk will take care of all of these.

[psa10]

I have used my credit cards recently, used almost $1500 on one a month ago for several different items, including paying off one payday loan, have been making the payments. I take it under a 13 that credit card usage times dont really matter as this is a repayment plan, am I correct on that? Thanks

[DUMBAGAIN]

We were in the very same boat 4 years ago. We had a chapter 7 and then 4 years later there we were, head over heels in debt! LOTS of payday loans, the IRS (cause we changed our deductions trying to keep our head above water), credit cards, the whole nice yards. What I can tell you is I wish we would have been forced into a chapter 13 the first time, why? Well we obviously did not learn a darn thing going through the chapter 7. However the last 4 years have been eye opening. We have learned a lot about money, ourselves, budgeting and what that actually should look like. We will be done in about 6 weeks, I can honestly say, unless there is some act of GOD we will never be in this mess again! Cash, Cash and more Cash. If we don't have it, then we won't buy it.

We could not survive another BK. I would tell you to ask yourself how you got right back into this mess and then do everything in your power never to get here again, but the Chapter 13 will teach you some hard lessons, but I believe in the end you will be a better person because of it!

Its not easy doing a Chapter 13 not at all, but again I think what you gain in education of going through a Chapter 13 will be worth its weight in gold.

Good Luck!

[despritfreya]

Here in AZ payday loans are actually called title loans

Not totally correct. Yes, once the payday loan law took effect those bottom feeders changed to title loan peddlers but, if your loans are based upon your pay checks and have nothing to do with a vehicle title, they are still payday loans and illegal in AZ. Did you get the loans from a local “brick and mortar” store or was it from the Internet? If you used your vehicle title the “lender” is a secured creditor and you need to make sure the attny you speak to is aware of it.

I take it under a 13 that credit card usage times don’t really matter as this is a repayment plan, am I correct on that

Unfortunately, you are not correct. 11 USC 1328(a)(2) incorporates into Chapter 13 the non-dischargeability provisions of 11 USC 523(a)(2). Fortunately, to date I personally have never had a creditor file a timely complaint covering credit card use in the months prior to filing in any of the case we have handled. But, it can happen.

Des.

[murph996]

illegal, or not, the Payday lenders should be included in your BK. The illegal ones aren't very likely to file claims, but they may. I had long discussions on this point with my attorney. You could fight the legitimacy of the claims if you'd like..but probably not worth it. If they are storefronts, they are very likely legal--in that they found a loophole. That's the case in Ohio..the law they passed, actually made the payday lender problem worse.

[psa10]

Thanks everyone for your input.........

[despritfreya]

in Ohio..the law they passed, actually made the payday lender problem worse.

Same problem in AZ. These so-called title loan operations are on almost every street corner - much more so than when we were just dealing with "payday" lenders and, in the past few months it has gotten noticably worse.

Des.

[dmc-2008]

Those payday loans are incredible and scared! I think a chapter 13 teaches you how to live within your means but if you don't you can lose everything! Gotta be serious and it sounds like you are ready, Good luck!

[psa10]

Thank you, the pay day loans once you get one are very difficult to get rid, I got myself into getting four of them thus the bind I'm in now

[AngelinaCat]

One of the WORST things you can do is get involved with payday loans. They are extremely addictive, which you have admitted. Further, you have FOUR of them!

We had to detach ourselves from someone we were trying to help, because she would not stop with the payday loans. She only had ONE, which she renewed every month. This was after we gave her money to pay the current loan up, with a little cash reserve for emergencies, and a nice car that was very fuel-efficient compared to the gas-a-holic van/beast she drives.

She broke the car, and squandered the money, and is still in default on her bills.

Because we refuse to *help* her anymore, i.e., give her money, we have been written out of her life, which is fine. She is a *brilliant* person, and a member of MENSA. That doesn't mean she has any common sense.

The very FIRST thing you must do is to learn to live within your means. And do NOT touch your 401k. That is your Retirement, and is exempt money under BK laws.

Please say that you have really and truly learned your lesson.