Say I file Chapter 13.......

[Dweezel]

and can only service my mortgage(s) and my vehicle lease. Will they discharge all of my unsecured debts? Doing a cash flow and I can do the secured, but sure can't see how I could do anything else. Possibly pay 20% over a 5 year period would be best case scenerio.

[FilingOnMyOwn]

Is there a reason you wouldn't qualify for chapter 7? You need to be able to repay at least 25% to file 13.

[bowlingmt]

payback

The attorneys we talked to said there was no minimum amount we had to repay, the creditors just had to make out at least as well as they would if we filed a 7. Our payback is set at about 15% (though we haven't filed yet) according to the 2 attorneys we have spoken with.

[FilingOnMyOwn]

Sure, an attorney would like you to file chapter 13. He makes twice the $ that way. Why go through a plan if you can do a 7?

[dac67]

We are only paying back 7% to our creditors, so it really depends on your income. We are paying for 3 instead of 5 years cause we don't make the median income for our state.

[cso5@]

100% to Secured, 4.97% to Unsecured

Every case is different, so blanket statements like you have to pay back at least 25% sometimes just don't make sense.

I was behind in both my first and second mortage, federal and state income taxes, and property taxes. Interest and penalties were accruing on the income tax debt. A 7 wouldn't do anything for that, I would have to enter some kind of payment arrangement, and interest and penalties would still accrue.

In my 13, the interest and penalties that had accrued are treated as one category of debt -- unsecured, non priority. As are the personal loan I had and the credit card debt I had. That is being paid at 4.97%.

Priority debt is the taxes. Being paid at 100%

Secured debt is the mortgage and 2nd mortgage. Being paid at 100%.

There is something about the car -- I had it for a long time, and now I am paying through the plan 100% of its blue book value, 4.97% on the rest of the loan of it. It was a car loan and I was past the -- I don't remember exactly how many days or months you have to be into a loan under the new rules.

So if you have a house you want to keep, or cars, (and these assets meet the exemption rules for your state) or are behind in debt that is best handled in a 13, like taxes, or are above the median, that's when it's best to look into a 13.

Good luck to you -- I am about 6 months into a 56 month plan -- so again, when people say, oh the old rules could be 36 months, now everyone HAS to be in a 5 year plan -- just not true.

Every plan is different, every situation is different.

Hope this was helpful.

[SinkingFast]

FOMO is correct, AND the other posters are correct as well.

The New Law was written with the provision that between $100 and $166/mo of disposable income, the Debtor/Filer would payback 25% of their debt. Otherwise the Debtor/Filer would qualify for a Ch 7.

BUT, Courts are not enforcing the Law that way. According to what I've heard here, our Court will force a Debtor/Filer into a Ch 13 when their disposable income exceeds $100/mo regardless of the %'age level of payback. Other posters have heard similar comments in their areas as well.

Other posters, such as those that have posted above, are in Ch 13 payment plans where they are paying back 10% or less of their debts owed.

[aa06a47]

OK, I've done alot of research on this one so let me see if I can help.

If your disposible income is between 100-166 / month and your unable to pay back to the creditors 25% of what is owed to them, "abuse" is not presumed and you should be able to file a chapter 7. The problem is the court has the final say and will determine if they will allow the chapter 7 or chapter 13. My understanding is the court generally looks closely at this for over med filers with between 100-166/month of disposible income.

Those with disposible income which would pay the trustee at least 10K over 5years (167/month) will not be able to apply the payback percentage as an argument as the law clearly states 25% or at least 10K to unsecured creditors.

I think Congress intent was to not let the person off scott free that had 200k in credit card debts and could only pay back say 10% (20K) while making the guy with 20K in debt be strapped to a chapter 13 who can only pay 2K back.