confused about how the 13 pymt is determined

[mb1966]

i have been reading on here for a week or so and seem to be confused about how you guys are saying they come up with the payment amount. It seems that pretty much everyone is saying that they add up all your income and them subtract all your expenses, and whats left is your payment. How are you at all able to save any money? What if something happens and you need extra cash to cover it or take of the problem? Maybe im missing something....it would seem if it was like that you would still be in the same boat ( having no money) only you wouldnt have some of your bills to pay. Am i understanding this right?

[Kingxray]

I am curious about this question as well. We might be coverted from a 7 to 13 and I would like to know how the payment plan is determined. Is it all of your disposable income? Also do they take all of future assets such as bonuses, tax returns, or an unknown inheritence?

[optimistic1]

Well it depends if you are already beyond your means or not. Each expense typically provides you with some cushion. Cushion meaning, stuffing it away in a piggy bank at your house, for lifes little surprises.

So, for instance, I can claim a home maintenance expense, monthly at $100. Without providing proof. But in reality, I dont spend even $20 a month.

So, tada, there is your "savings", and you can do this across the board with your expenses to a certain extent.

This scenario may work with some people, and others may be so cash strapped under the plan. That you basically dont have savings.

Everyones case is different.

[mb1966]

i was wondering if alot of people cushion their expenses a little, and thats what i thought about doing. BUT.....when doing that , do you try and just have a little left, maybe 200 or 300 or what? Im sure you dont want to seem to obvious

[liz417]

As 'optomistic' pointed out, your budget should be "padded" a little to give yourself some wiggle room for those 'unexpected emergencies' that WILL happen in the next 3-5 years. In a ch 13 repayment plan, your have a set of 'guidelines' for your expenses and you agree to hand over ALL your disposable income to the Trustee, therefore, if you have an unexpected expense pops up, you must "cut into" something else in your budget (ie: food or clothing budget) for that month. Also, to "kingxray", yes, our district/trustee requires us to hand over all future bonuses and yearly tax refunds Your attorney will know what your District/Trustee expects.

Good Luck!

[mb1966]

well, when i figure mine, and not really padding much of anything i have about 400 left over a month

[liz417]

well, when i figure mine, and not really padding much of anything i have about 400 left over a month

Are you sure you've added up everything? Make sure to sit down and list ALL your expenses, don't forget to add things that aren't paid on a monthly basis, like eye glasses, contacts, subscriptions, roadside assistance, vet bills, EVERYTHING, and hopefully your $400 DMI will go down to zero

[mb1966]

oh yea, there are the contacts and glasses my son gets...in fact he goes monday for that very thing and it will cost me. I just didnty know where to add it in. I probably could have finagled it some and got closer to zero, but i didnt know how that would look. I have actually been making less money the last few months and my car ins has gone way up because my son wrecked his car. So in reality, i have no money LOL

[optimistic1]

mb1966 try using this calculator, its perfect.

http://www.ca-bankruptcy-attorneys.com/calculators/expense_calculator.html

[mb1966]

that is a gool tool. When i use that it gets me closer by like $140

[mfaina]

Just wonder if anybody here considered going with a debt settlement co. before trying to jump to Chapter 13? Pro and cons? What will happen if you CAN'T make the payments anymore under Chapter 13 (loose your job)? Can you convert to Chapter 7?
Thanks!

[optimistic1]

That question deserves a new thread.

However,

Debt settlement, you can easily do yourself, start saving your money and just wait for the settlement offers to come your way. Not all creditors will do this. Some will sue, and will win, and will garnish your wages for the total amount plus fees. Dont waste your money on a company to do it for you when you can easily do it yourself.

Chapter 13, much more complex, you might pay the credit cards nothing at all under this type of plan, and get discharged of all of it, but everyones case is different, and there is no guarantee, for all you know you might pay them back 100%

If you lose your job, you might be able to convert to a 7, but no guarantee, because just losing your job doesnt give you the right to all of the sudden claim a 7. They might just pause your payments until you can find another job, and then your plan payment is increased to pay off the months you didnt make any, or your plan may be lengthened if you had less than a 60 month plan.

[optimistic1]

that is a gool tool. When i use that it gets me closer by like $140

Thats great, and as long as you either dont exceed what is allowable, then you wont be really paying all that much into the plan. And if you do exceed the allowables just make sure you have receipts to back them up.