Accounts removed off of credit reports, Filed Chp13 on 3/17/20

[Justme79]

Good afternoon,



I pray all is well with you and your loved ones during this dificult time we are all facing (COVID-19). I filed chapter 13 on Tuesday (3/17) and it's already reporting on my credit reports (all bureaus). I have a subscription with MYFICO, and my notifications have been alerting me all weekend. My scores are going up, surprisingly, and several of my accounts have been removed/and or reporting zero balances. Is this normal? I have a 5 year repayment plan. For the accounts that are now reporting zero balances and have been removed, will those creditors still be included in my repayment plan? I'm still doing my research on chapter 13, but I find that speaking with others is better than most books I have read. I'm awaiting the date for my MOC.



Thank you for your help, I'm trying to navigate through chapter 13 as best as possible.

[Justme79]

PS.

The day of filing (3/17/20) my scores were (months of not paying prior to filing, per my lawyer, which I'm pist about)



Equifax 497

Transunion 504

Experian 488



Current Scores (03/23)



Equifax 544

Transunion 520

Experian 539



I did close all of my paid in full/perfect credit accounts prior to filing.

[justbroke]

When you're about to file bankruptcy, you shouldn't worry about late payments. It is wasted money. The bankruptcy itself is a major blow to your credit score. Even a person with a 700 score will see a minimum of a 200 point drop upon filing.

Additionally, and you may not know this, the Trustee -- in a Chapter 7 -- would claw back payments over a certain amount, anyhow, which were made within 90 days of filing. (For a Chapter 13, this could impact the amount you must pay based on the Chapter 7 liquidation test.) Those payments would then be used in the bankruptcy. So in order to not make your case a complex "asset" case, it is highly recommended to stop paying card -- and stop using them -- within 90 days of filing.

Some accounts will be removed but all will have the balance changed to $0 and at least one of the following markings; included in bankruptcy (IIB), or debt discharged in a Chapter 7, 11, 13 (etc). Since you're going to be in a Chapter 13, it is likely that the entries will have the latter marking.

Since you're now in a 5-year Chapter 13 I would suggest that you not concentrate on your scores. Hardly anyone will touch any debtor in an "active" bankruptcy (and Chapter 13 bankruptcy are active (pending) for 3-5 years).

Your scores will likely levelize in the high 500's to very-very low 600's within a year or two. As the Chapter 13 ages, it has less affect, but will definitely keep you from the mid-to-high 600's until near the end unless you have other factors.

[Justme79]

Thank you for your response. The only creditor I was paying before filing was Discover, $100 per month and my car payment, which was totaled on 1/19/20, and Geico paid that off last week (BMW Financial).

I stopped paying everything else a while ago, and the last creditor I paid off was in October. I did ask my lawyer to ask the trustee if I could have a secured credit card as I do need to rent vehicles from time to time to visit my parents.

[justbroke]

I did ask my lawyer to ask the trustee if I could have a secured credit card as I do need to rent vehicles from time to time to visit my parents.

I had to do this, and it worked out very well for me. I built it to $5,000 within about 2 years. If you're getting it for work, then the trustee should have no issue. I