Finally filed!

[Witchywitch]

Hi everyone!

Happy New Year.

We plan and talked about filing bankruptcy since August/September. Talked to a lawyer, paid fees and submitted the requirements.

My brother passed away Oct, kids got sick and husband got sick (out of work until Dec).

After submitting new sets of requirements, we finally filed before the year ended.

Already made the first payment, 341 hearing next month and confirmation hearing a month after.

I just have few questions. I know it is too early since we just started.

We are into 5 year plan. Can it be finished earlier than that?

I already read about cars before. I have a car almost 70k miles, upside down and we can't cram down because of house equity.

My mom suggested we surrender the car and get a car on her name with lower monthly payments (current payment 510) and we just pay her. Possible?

What to expect in 341 meeting? I am getting really anxious but I know it is a way to freedom (not strapped from debt).

Thank you so much!

[Lavish]

I filed a few months ago. The 341 meeting isn't really anything to be concerned about. For me, it was more embarrassing than anything - you are in a room with other people who hear all about your debt and income.

I don't think you can pay a Ch 13 off early...you are either in a 5 year plan or less than 5 years if you are paying 100%.

I'm not quite sure, but I don't think surrendering the car is a good idea. I think that would only make your Ch 13 payment go up, because you would appear to have more DMI. Maybe others will chime in and let me know if this is correct.

[sophieanne]

Lavish and Witchywitch - First of all Witchywitch..congrats for starting down the path to your new financial freedom! Happy New Year to both of you.
If you are in a 100% payback chapter 13 YOU CAN pay off early. I know, because I did it. And a clarification, for a Chapter 13 you are either in for 36 months or 60 months, regardless of whether you're paying a percentage of your debt or 100%. If you are in a 100% payback plan, you can pay off early. Good luck going forward.

[Witchywitch]

I filed a few months ago. The 341 meeting isn't really anything to be concerned about. For me, it was more embarrassing than anything - you are in a room with other people who hear all about your debt and income.

I don't think you can pay a Ch 13 off early...you are either in a 5 year plan or less than 5 years if you are paying 100%.

I'm not quite sure, but I don't think surrendering the car is a good idea. I think that would only make your Ch 13 payment go up, because you would appear to have more DMI. Maybe others will chime in and let me know if this is correct.

Thank you! I would actually ask my lawyer for possibilities. Does 341 meeting takes longer or just about 10 minutes as I was reading online?

[Witchywitch]

Lavish and Witchywitch - First of all Witchywitch..congrats for starting down the path to your new financial freedom! Happy New Year to both of you.
If you are in a 100% payback chapter 13 YOU CAN pay off early. I know, because I did it. And a clarification, for a Chapter 13 you are either in for 36 months or 60 months, regardless of whether you're paying a percentage of your debt or 100%. If you are in a 100% payback plan, you can pay off early. Good luck going forward.

Thank you and Happy New Year!

We're at 60 months. How would I know if we're at 100% plan?
Is 100% means paying all unsecured debt?

[sophieanne]

Hi again...100% means you're paying back all debts, secured and unsecured (where claims are filed by your creditors). If you're not sure of the percentage you are paying back, ask your attorney or you can wait for the confirmation order after the 341 is held/approved.

[spr250]

When I had my 341 meeting, everyone there including the 7's were all done within about 10 min. A properly prepared atty can have everything needed to keep it short. Can be longer if there are surprises, in my case a creditor showed up. Or the trustee has further questions about your case. The ones I personally saw, was just clarification purposes.

[justbroke]

We are into 5 year plan. Can it be finished earlier than that?

If you pay 100% of the allowed unsecured claims.

I already read about cars before. I have a car almost 70k miles, upside down and we can't cram down because of house equity.

House Equity is not the issue with cramning down. You can still cram down, but if you're in a 100% plan, you'll still pay back the entire amount. This is because a crammed down car is "bifurcated" into a secure claim and an unsecured claim. In a 100% plan you must pay back 100% of the unsecured claims, so it would seem useless. However, and this is a strategy issue, if something else happened whereby you didn't need to payback 100%... the cramdown strategy could be a winning one.

(I don't expect that something weird would happen that would allow you to not be in a 100% plan... just interesting to me!)

My mom suggested we surrender the car and get a car on her name with lower monthly payments (current payment 510) and we just pay her. Possible?

You'd have to talk to your attorney to see if you'll be able to keep the ownership expense and the loan as your debt. The question is certainly on whether you can keep that as an expense. But, if you're in a 100% plan, it's likely moot as you can do just about anything you like. I don't know if you're in a 100% plan.

What to expect in 341 meeting? I am getting really anxious but I know it is a way to freedom (not strapped from debt).

Nothing really. For Chapter 13s, it's really about reviewing some things and the Chapter 13 Trustee giving initial feedback on the plan.

[Witchywitch]

Hi again...100% means you're paying back all debts, secured and unsecured (where claims are filed by your creditors). If you're not sure of the percentage you are paying back, ask your attorney or you can wait for the confirmation order after the 341 is held/approved.

Thank you!

[Witchywitch]

If you pay 100% of the allowed unsecured claims.

House Equity is not the issue with cramning down. You can still cram down, but if you're in a 100% plan, you'll still pay back the entire amount. This is because a crammed down car is "bifurcated" into a secure claim and an unsecured claim. In a 100% plan you must pay back 100% of the unsecured claims, so it would seem useless. However, and this is a strategy issue, if something else happened whereby you didn't need to payback 100%... the cramdown strategy could be a winning one.

(I don't expect that something weird would happen that would allow you to not be in a 100% plan... just interesting to me!)

Our lawyer said we cannot cram down because of the house equity. I'm pretty sure our unsecured debt is more than our monthly payment x 60 months. So I am guessing we are not in 100% plan.

You'd have to talk to your attorney to see if you'll be able to keep the ownership expense and the loan as your debt. The question is certainly on whether you can keep that as an expense. But, if you're in a 100% plan, it's likely moot as you can do just about anything you like. I don't know if you're in a 100% plan.

Sent him an e-mail and would see what he said. I am kinda thinking just to use the car for 2-3 more years before considering another car. Actually the bank who holds the financing called my lawyer and said they would be taking the car if we will be 30 days late on payment due to BK.

Nothing really. For Chapter 13s, it's really about reviewing some things and the Chapter 13 Trustee giving initial feedback on the plan.

Thanks. We are just anxious.

[justbroke]

Our lawyer said we cannot cram down because of the house equity. I'm pretty sure our unsecured debt is more than our monthly payment x 60 months. So I am guessing we are not in 100% plan.

The only reason to avoid a cram down is that you're in a 100% plan.

Sent him an e-mail and would see what he said. I am kinda thinking just to use the car for 2-3 more years before considering another car. Actually the bank who holds the financing called my lawyer and said they would be taking the car if we will be 30 days late on payment due to BK.

Is your bank a credit union? I only ask because that is very strict! I don't blame the bank, but that would be a very quick repossession.

Best wishes to you on your Chapter 13 journey. Mine just finally closed back in December and I am still in shock. I haven't even replaced my 2012 car yet even though that was going to be one of the first things I did after discharge/close! My brain keeps saying "do you really need another" car payment?

[Witchywitch]

The only reason to avoid a cram down is that you're in a 100% plan.

I would have to ask him. All I know is that he said we can't. I guess it is better if we have a 100% so we could possibly finish early. My student loans are also in the list when I registered in NDC. So would the trustee pay my student loan and after the BK13 it would also be gone? Or is student loans can't be discharged?

Is your bank a credit union? I only ask because that is very strict! I don't blame the bank, but that would be a very quick repossession.

Best wishes to you on your Chapter 13 journey. Mine just finally closed back in December and I am still in shock. I haven't even replaced my 2012 car yet even though that was going to be one of the first things I did after discharge/close! My brain keeps saying "do you really need another" car payment?

Thank you and congrats on your discharge!

It's not a credit union. HFS holds our car financing. I actually called their BK department and the CS said they do not like payments being 30 days late because of BK. They would file for relief if that happens (not that we would let it happen). We are 5k upside down on that car. I also have an hour back and forth to work so my car has more or less 20k miles per year.

[justbroke]

I would have to ask him. All I know is that he said we can't. I guess it is better if we have a 100% so we could possibly finish early. My student loans are also in the list when I registered in NDC. So would the trustee pay my student loan and after the BK13 it would also be gone? Or is student loans can't be discharged?

Yes, the Trustee will pay student loans during a Chapter 13. They are general unsecured creditors and treated just like credit cards, installment loans (unsecured) and other unsecured debt.

Thank you and congrats on your discharge!

Living the life! LOL!

It's not a credit union. HFS holds our car financing. I actually called their BK department and the CS said they do not like payments being 30 days late because of BK. They would file for relief if that happens (not that we would let it happen). We are 5k upside down on that car. I also have an hour back and forth to work so my car has more or less 20k miles per year.

Is that one of those consumer finance companies? If so, they are known to be brutal, because they are local. Ahh, I see... they will file for Relief From Stay (RFS)... not an immediate repossession. A car is very important to earn income.

(I didn't ask if the car was purchased, with the HFC loan, within 910 days of filing. That's about 2.5 years before filing. If so, that's why you can't cram down the vehicle. It would be due to the so-called 910-day clause found in the bankruptcy code.)

[Witchywitch]

Living the life! LOL!

Enjoy! We have 60 months to the finish line!

Is that one of those consumer finance companies? If so, they are known to be brutal, because they are local. Ahh, I see... they will file for Relief From Stay (RFS)... not an immediate repossession. A car is very important to earn income.

(I didn't ask if the car was purchased, with the HFC loan, within 910 days of filing. That's about 2.5 years before filing. If so, that's why you can't cram down the vehicle. It would be due to the so-called 910-day clause found in the bankruptcy code.)

We got the car first quarter of 2017 so It is more than 2.5 years. Our child was just 4 months now she was more than 3 years old.

Also, I checked my claim list in NDC website. The first "claim" is debtor refund and the creditor is NDC_DFLT. Claim amount is $0.00. under priority status. What is that?

Thanks!

[justbroke]

Also, I checked my claim list in NDC website. The first "claim" is debtor refund and the creditor is NDC_DFLT. Claim amount is $0.00. under priority status. What is that?

I think it's reserved by the Trustee so that they can issue the debtor a refund check. They make the debtor a creditor, for some reason. My guess is that "NDC_DFLT" just means it's a National Data Center Default creditor. That way, the Trustee doesn't have to put you in as a creditor.

If you are entitled to a refund of payments, due to an overpayment, this is likely where the Trustee would account for and make that payment.