Silly question - if you had a choice would you?

[zpbk13]

I know the numbers dictate whether you are in a 7 or a 13 and when we started looking into bk we were told we had to be in a 5 year 13 with $375 payments. I was mentally prepared for that. Then our attorney got back to us and with a little creative budgeting, we just squeak by with a 7.

My question is for those in a 13, if you could, would you have done things differently? Do you wish you could have just filed a 7 and been done with it? I can't help though thinking about the "advantages" of what I perceive are in a 13. First, the 13 is only on your credit report for 7 years instead of 10, correct? Second, I do feel a certain obligation (although hubby does not) to pay back some of the debt if we are able. Third, if our circumstances change, we can always convert to a 7 but if you are already in a 7, where else is there to turn? And finally, I think a 13 will be a good way for us to learn to budget our money. I have never been good at budgeting before but hope in a 13 we would be forced to learn to live below our means.

These were just some of the things I was thinking today. Any and all comments are appreciated!

[justbroke]

My question is for those in a 13, if you could, would you have done things differently? Do you wish you could have just filed a 7 and been done with it?

Now that I'm in a Chapter 13 for just about 1 year... wish I was in the straight Chapter 7. I would have been done.

I can't help though thinking about the "advantages" of what I perceive are in a 13. First, the 13 is only on your credit report for 7 years instead of 10, correct?

Yes... but it is well known that you can get credit within months after a discharge from either Chapter.

Second, I do feel a certain obligation (although hubby does not) to pay back some of the debt if we are able. Third, if our circumstances change, we can always convert to a 7 but if you are already in a 7, where else is there to turn?

My Chapter 13 pays back nothing to unsecured creditors, so the point is really moot for me. The funny part is... if I don't pay the Trustee that 10% fee, my unsecured creditors would get something.

And finally, I think a 13 will be a good way for us to learn to budget our money. I have never been good at budgeting before but hope in a 13 we would be forced to learn to live below our means.

I applaud you for wanting to learn how to budget in a forced manner. However, a Chapter 13 really doesn't account for unexpected things. The budget realities are serious and most people can't cope with an "absolute" budget. Sure, I have had and continue to have a spreadsheet with my "budget". It lets me look at the financial impact of spending $100 today will have on things up to 2 years from now! However, I can wiggle around and still spend that $100 today, even though it affects something in 9 months. What I do in the interim is save a little more. When this happens in a Chapter 13, an immediate and heavy financial heed...

there just may not be that money sitting there. You must build an emergency fund in a Chapter 13. Unfortunately emergencies seem to keep popping up, when you're in a Chapter 13.

[Ifonly]

My unsecureds get $0 also....the CH13 is good for me because it is primarily paying federal and state taxes.

That being said, justbroke is correct about the budgeting nightmares. My husband's car needs a major service, I owe the vet $100 from six months ago (it was $600 - this is the balance) so I haven't scheduled one dog for shots that she was due for in mid-April, gas is rising, menu planning and food shopping is hell, the list goes on and on. I'm happy to not be spending money that I don't have and grateful to not be incurring more debt but I am definitely stressed out about the eventual flat tire, etc. I also haven't had a great deal of time to tuck anything away since we just filed and all extra $ went to the retainer and the security/1st/last on our new rental home.

Even if my CH13 payment were just $125, I would rather have that money to save for my children or to be able to buy fresh strawberries once a month, KWIM?

I gave up on any moral obligation I have to my debt. They didn't seem to have any moral obligation to not raise my interest to 32.99% based on "behavioral pricing". Well, you got the behavior you wanted.

[sharina]

After a year of being in Chapter 13 and learning way too much on this forum - I would say if given a choice Chapter 7 any day. My signature says it all in my opinion- almost all of that money I am paying is going to unsecured creditors and the trustee. If they had kept the interest rates reasonable, I would probably have never filed. I cannot wait till I am done and over with this.

[krielly]

I agree. If you can do a 7, that's the way to go, based on the details you have provided.

While it's true that a 7 will remain on your credit report longer than a 13, a 7 has it's advantages. Once you are discharged from your 7, you will be able to find credit. Most lenders won't touch you with a 10 foot pole while you are in a Chapter 13 (even with trustee permission).

You can begin rebuilding credit sooner in a 7.

The biggest advantage is not being under the thumb of the trustee for several years. After discharge, you get your fresh start and move on.

You don't need a Chapt 13 to teach you financial management (although I admit is has taught me a lot in the past 4 years of our 13). There are many other resources out there to help you if you sincerely want the help.

Good luck!
K