Our BK is going to Court today to be Dismissed :-(

[Cindy]

Well the trustee is going to court today to dismiss our BK (Ch13) we did not have trhe money to pay the back pmts (2 mo), and we did not want this to happen, but I have a very important question, we are essentially paying our CC and IRS we pay home and cars separate, mine will be paid off this week.\
Before we filed BK we were paying the IRS, we made an arrangement, and of course paid the CC as much as we could, my REAL concern is trhe IRS, we have always worked with them NEVER avoided them, does anyone know if they would work with us as they did before, also will it be possibe to get a loan to re-fi the house and pay a lot of things off we could not while in BK?? Sorry for the long post, but this is very nerve racking !!!!!

[Jman30]

Well the trustee is going to court today to dismiss our BK (Ch13) we did not have trhe money to pay the back pmts (2 mo), and we did not want this to happen, but I have a very important question, we are essentially paying our CC and IRS we pay home and cars separate, mine will be paid off this week.\
Before we filed BK we were paying the IRS, we made an arrangement, and of course paid the CC as much as we could, my REAL concern is trhe IRS, we have always worked with them NEVER avoided them, does anyone know if they would work with us as they did before, also will it be possibe to get a loan to re-fi the house and pay a lot of things off we could not while in BK?? Sorry for the long post, but this is very nerve racking !!!!!

Hi Cindy -

I was looking at some of your other posts and I am sorry for your trouble in a Chapter 13. I briefly looked at all your posts but if I can ask, what made you fall 2 months behind?
Secondly, I would need more information to answer your IRS question. Typically, creditors are not willing to really work with you if you are dismissed from a BK - they are like sharks, pouncing on you the minute you get dismissed. They know they can because they know you can't turn around immediately and declare BK. How much do you still owe the IRS??

Lastly, you can always re-fi your house. The question is do you have the credit to do it? You could find a sub-prime lender but then your rate would be so high it probably wouldn't help much.

[HHM]

Jman is right about the mortgage, it is "possible" to refi, but I doubt your credit is up to the task. Not only do you have the bad credit you had before the BK (since you didn't finish your BK and receive a discharge), now you have a dismissed BK on your record. Any deal you get, will be very bad (and probably end up costing you more in the long run than if you simply paid your existing debt as best you could).

I think the IRS will still work with you, they are not like other creditors...so I don't see why they wouldn't work with you. But I wouldn't hold out any hope for the Credit Cards, they have no incentive to work with you and unless you have some money lying around, you don't really have anything to offer.

The secured creditors (i.e. car, house etc), so long as your current on your payments, will be no problem, just keep making the payments.

I hate to say it, but this is just not good. Was there really nothing you could have done, sell something, get an advance on a paycheck, beg from family or friends, etc to get back on track. Realize, once the case is dimissed, you cannot refile for at least six months.

However, since the dismissal is a foregone conclusion, you need to start focusing on a plan to deal with the debt, BE PROACTIVE. Get in touch with the IRS and get back on whatever payment plan you negotiated. You may want to go to a Credit Counseling firm to deal with the credit cards, at least they can reduce or stop interest from compounding.

[Jman30]

I hate to say it, but this is just not good. Was there really nothing you could have done, sell something, get an advance on a paycheck, beg from family or friends, etc to get back on track. Realize, once the case is dimissed, you cannot refile for at least six months.

This is really the bottom line here. Having to go through the BK process was one of the worst events of my life, but at least it provided a "blanket of protection" against creditors. In some ways, it was comforting to know that I was paying my debts (struggling, but still paying!) through a Trustee and nobody could harass me on the phone or in writing or anything like that.
Even after I refinanced out of my BK, the first few weeks were almost scary, thinking "wow, I am on my own again financially....."

If there is ANTYHING you can do to stop the dismissal, I would consider it. For the next 6 months you will be like red meat to the creditors and I can almost bet you'll be back in BK in another 6 months, starting over again.

[Cindy]

Thank you everyone for your answers. Well JMAN the reason we got behind was due to slow business (we are self employed) as well as being in BK no one would work with us to help with any kind of Loan as I'm sure most of you realize. Consequently, with high expenses at business, and slow business which adds up to slow pay coming in. My husband gets paid from the company and that is not a weekly paycheck, just a fiqure for the IRS filing for the corp. there are only two of us working there I do billing he does the Orthopedic braceing etc, which is not lucrative due to not a lot of patients coming in. As for family we have non here and the family I have is in California and have nothing we are better off even with the BK... and borrowing/loans are out we tried everywhere.

I am not concerned about the creditors, the IRS is my concern, and as soon as I know they have the Dismissal in hand, we are calling them to arrangeayments again, I appreciate all the answers and tips, they all are invaluable, and I surely wish this didn;t have to happen, but my Attorney said that it had gone too far and we could not stop it, I even called the Trustees office they offered an Interlocatory or agreed and we have had both within the past year so we could not do it again. I will be on here reading more I need all info I can get...Thanks again everyone :-)

[rrockinggramma]

I have been in your shoes. I have had 2 chapter 13's dismissed due to missed payments. But this third one is the charm. I am almost done. However, it will take about 6 weeks for the creditors to come crawling once the dismissal happens. Yes the IRS will work with you. They want their money. However everyone is correct about your credit. It will not allow you to refinance anything. However, another consideration might be to refile your chapter 13. But this time, base it on the current slow condition of your business and not allow your payments to be unmanageable. I did that this 3rd time and it has worked. Good luck!

[Cindy]

Thank you RockinGramma,

Ths is what I wanted to hear acuall....I know the Creditors will be back arund and to be honest they are not my worry, the IRS is, and you as well as everyone else has said what I wanted to hear and expected as well. As of today our attorney says the IRS does not have the dismissal in hand, they could have it tomorrow, but leaves me a few days here and we will contact them.

Thanks everyone for some reason I feel so much better, don;t ask me why. The only thing my husband needs to do is get away from this office fr a few days, his stress level is about to blow

[TylaLPN]

I have to ask this. I understand that owning your own business can be hard and stressfull. I can't even imagine. But could you or your husband have got a part-time job or figure something out to make those payments. Filing is stressful enough and is done to get out of debt but somehow you've got to make your payments. Good luck.

TylaLPN

[lrprn]

Just curious, Cindy....why did your lawyer not file a motion to amend your Ch 13 plan if your income dropped so much that you couldn't make your payments? If your business income shortage has gone on now for at least 3-4 months, that would change your six-months-back income level wich could change the means test outcome figures. Is it possible you could even qualify for a Ch 7 within a few months if your low income continues?

[Cindy]

Thanks everyone for your input...our Attorney never seemed to try to do anything for us....

I wonder now that we are officially out of BK, is there ANYONE out there that would re-fi our home????? One place (Country wide) said you have to be out of it 2 yrs. Is this true???