A few questions, please

[nowwhat]

Hello everyone,

A couple of questions for someone who is entering the world of Chapter 13.

I have hired an attorney. On his advice, I purchased a car (my old car was 15 years old)... I have stopped paying my CC's. (has been about 2 months).

I have around $70,000 in unsecured debt - including a personal loan with a local merchant.

Questions - I understand I need to wait 90 days after purchasing a car. I want to keep the car, and another vehicle that is paid off. I want to keep the house and the two mortgages that are current. House is worth $145,000 - I owe around $140,000.

Will they look at the value of the vehicle that is paid off and consider that as income?
I have elderly parents, what happens if something happens to them and there is inheritance involved?
The local merchant with whom I have a personal loan - can they tell other local people about my situation? Or am I protected by any law in which they can't?
What about any raises or change in income after I file?
Should I file right away (after the 90 days) or should I wait?
What about the equity in the house?

Thanks for any help, this site is very helpful.

[optimistic1]

Income is income, like from an actual job.

The other car would be seen as an asset, unless it can be exempted under your state bk laws, your attorney should know the answer.

If you receive an inheritance under your Chapter 13 plan, the trustee would take that money to pay off your creditors.

Unless you receive a significant raise would you even need to worry, trustee's understand that people receive raises for cost of living etc etc, but if you got a new job or promotion and got a raise of several additional dollars per hour, then you would need to talk to your attorney.

Most states have homestead exemptions to exempt your equity from the trustee.

[lrprn]

I understand I need to wait 90 days after purchasing a car.

This may be a local custom in your court. Some Ch 13ers have bought cars less than 90 days before filing and their trustees haven't had a problem with that.

Will they look at the value of the vehicle that is paid off and consider that as income?

No, the court will consider the paid off car as an asset. If you can't protect its full current market value when you file with your state auto or other allowed exemptions, then if the car has sufficient resale value the trustee can take the car and sell it to get whatever $$ you can't protect to share with your creditors.

I have elderly parents, what happens if something happens to them and there is inheritance involved?

Any inheritance you receive during your active Ch 13 that can't be protected with your state exemptions can be taken by your trustee. Your parents should set up a will now that protects you from losing the money if they pass away during your Ch 13. I'm not an expert on how that's done, but I know it can be done.

The local merchant with whom I have a personal loan - can they tell other local people about my situation? Or am I protected by any law in which they can't?

Bankruptcy is a public announcement. Many local papers list every filed bankruptcy in the paper every week along with the births, divorces, and deaths. There's no law that prevents anyone from telling anyone else about your bankruptcy if they know about it.

What about any raises or change in income after I file?

If your income increases significantly (like more than 10% at once, although this isn't a hard and fast %) and permanently or your expenses decrease significantly and permanently, your trustee has the right to ask the court for a modification of your plan to increase your payment because you have more disposable income. On the other hand, if your income *decreases* significantly and permanently, or your expenses *increase* significantly and permanently, you and your lawyer can file an amended plan that will decrease your payment.

Should I file right away (after the 90 days) or should I wait?

There's no way given the information you've provided to know what's the right thing for you to do. Have you set up free initial consultations with 3-4 experienced bk lawyers in your area yet?

What about the equity in the house?

To know just now much equity you actually have in your house, you'll need a reliable appraisal of its current value in this depressed housing market (and that's not Zillow or your county property tax bill!). Have houses very similar to yours been sold in your neighborhood in the last few months?

[eddiep]

lrprn

If the op is in a 100% payment plan would any of the above apply? Would op have to exempt car, inheritance, home equity?

[CH33 Paralegal]

cyberhomes.com is a BOA site that gives a more realistic value of your house. Plus it's BOA doing it, and they're lending the money.

I think zillow is either crooked or behind the times.

The property tax records is always outdated.

[CH33 Paralegal]

and if you're paying it all back, then you're paying it all back.

Pay it out as fast as you can.

[lrprn]

lrprn

If the op is in a 100% payment plan would any of the above apply? Would op have to exempt car, inheritance, home equity?

Yes, everything would still apply. If their trustee decided to pull the trigger on taking the car, inheritance, and/or extra equity, the 100% filer would just finish their plan earlier due to the additional dollars being paid into the plan, that's all.

[eddiep]

wow, I thought that was the only benefit of filing ch13. That a ch7 was a liquidation of assets but you could keep them in a 13.