How do chapter 13 families make it thru the month?

[Pandora]

We opted for Ch 13 to save our cars and home.

We have to stall and stagger paying our bills, which are all 1 month behind. I can't say how, why, or what has us financially strapped. I'm just sharing how it has been for us.

Ouch - this is a tough place to be in for anyone in a Ch. 13. A correctly budgeted plan isnt punitive and shouldn't have you falling behind on any bills due. If it does (and you are apparently) then you need to take a long hard look at your budget, going through what are real needs vs. wants as it then becomes very apparent one cannot afford the things intended to keep. If you decide that you WANT to keep the house vs. renting something possibly cheaper (and same for your car) - then you have the decision to make that perhaps your children's activities must be cut. Determine how much $ you spend over what you budgeted for just for your children's activities. Paying for those / extra gas vs. groceries seems like an easy cut IMO. Food is necessary - football/soccer/ballet, etc ..isnt.

You still have 40 months to go and you're behind, robbing peter to pay paul for basic necessities. Perhaps its time to re-think your Ch. 13 and convert to a 7. Right now its no different for you than had you not filed BK; you're still struggling to pay necessities.

[jetsfan2010]

As someone who has been in a 13 plan going on 5 months of a 60 month plan, I can tell you the unease of pre-filing is as bad as it gets. that payment sounds high now, but as many have said above here, you really have to look at what you can live with/without. Those needs vs. wants are the tough decisions you have to make early on in order to make a 13 work. You cannot predict the future, for better or worse. You might have an increase in income due to job change/promotion, or you might lose your job. 5 years is a long time, and there are very few people I know who are in the same financial situation 2 years ago as today. Communication with your attorney will be key for your plan to work, and as again many have stated, making sure you ask plenty of questions to your attorney now.

[dfincctx]

We opted for Ch 13 to save our cars and home. My wife and I are 44 years old and have 4 children ages 16, 14, 11, and 9. Thank goodness our monthly payment of $1150 is paid through automatic payroll deduction because we have been unable to stay afloat since our Ch 13 was confirmed in June 2009. Most stories I read have been by those who have adjusted their lifestyle, expenses, budgeting, etc. But that is not our case. Simply put, we have struggled financially this far and see no end until after we make our last payments 40 months from now. In our scenario, our biggest factor affecting our finances is the everchanging cost associated with our children. They are each active in school, a sport, and/or extra curricular school activity. Weekdays consist of driving to after school practices and weekends consist of driving to games, meets, etc. They are not overly involved by our definition and we have held them back from participating in many things due to our finances. But the bottom line is that we are faced with increasing costs per child as they grow older. Our worries over the costs of diapers, formula, and daycare are nothing in comparison to paying the electric, water, or telephone bill. Groceris and putting gasoline in our tanks is our biggest worry. We have to stall and stagger paying our bills, which are all 1 month behind. I can't say how, why, or what has us financially strapped. I'm just sharing how it has been for us.

[moe]

We are in Chapter 13 because our income went up. We got better jobs.

Now we're kind of hosed because we have an insider payment and cannot collect the payment from the relative. It's all just kind of a nightmare and I'm on this board trying to figure out what to do.

[momofthree]

I'm scared too!

I don't know how we'll get by either. Yes, the attorney was very harsh with me about our payments. They might be higher than what we pay now?

It's very unfortunate, as we could have done 7 if we'd done this earlier. However, it is also interesting because my husband would not have gotten his job if we'd done it earlier because they would not have hired him with a bankruptcy on his record.

We don't have car payments, no landline, we have no cable, and we borrow (for free) a neighbor's internet. We have no TV. We do not go out at night. We don't drink alcohol and rarely eat meat. We do not drink soda or eat anything but homemade snacks. We rarely go to Starbucks and if we do, we just get coffees, not lattes. We had a housemate even--someone who lived in a side room of the house. Where else could we cut? There are definitely places! But it's hard. I hate cutting food. I like to feed my kid good, fresh vegetables and so on. We don't have a dishwasher even. Seriously, it's just going to be SO HARD.

Our lawyer was assuring us we'd get a low settlement and then I called another lawyer and they said they wasn't true.

Anyway, I'm trying to do debt resettlement rather than bankruptcy. The twists and turns of all this are driving me CRAZY.

So why are you in a chapter 13?

[moe]

I'm scared too!

I don't know how we'll get by either. Yes, the attorney was very harsh with me about our payments. They might be higher than what we pay now?

It's very unfortunate, as we could have done 7 if we'd done this earlier. However, it is also interesting because my husband would not have gotten his job if we'd done it earlier because they would not have hired him with a bankruptcy on his record.

We don't have car payments, no landline, we have no cable, and we borrow (for free) a neighbor's internet. We have no TV. We do not go out at night. We don't drink alcohol and rarely eat meat. We do not drink soda or eat anything but homemade snacks. We rarely go to Starbucks and if we do, we just get coffees, not lattes. We had a housemate even--someone who lived in a side room of the house. Where else could we cut? There are definitely places! But it's hard. I hate cutting food. I like to feed my kid good, fresh vegetables and so on. We don't have a dishwasher even. Seriously, it's just going to be SO HARD.

Our lawyer was assuring us we'd get a low settlement and then I called another lawyer and they said they wasn't true.

Anyway, I'm trying to do debt resettlement rather than bankruptcy. The twists and turns of all this are driving me CRAZY.

[BKchapter13]

Sit down and figure out what can be cut even more, whether its housing to coupons, to your activites, once you have a little money saved keep making steps to add to the savings. I know it sounds hard to do but I even keep my gas down to 59 this winter, it was cold but I saved a ton of money. Thank goodness for spring. I am obsessed now with saving money.. good or bad, I say good, my poor hubby is freezing but there is money in the savings and he loves it as much as me. At 50 and 60 we can do it and I say anyone can do it if we can. good luck and I do hope everything works out.

[woeisme]

Settlements wreck credit like CH 13 does, but there are no guarantees or power of the court behind you. And with interest rates and fees the way they are, you can save a lot even in a 100% plan compared to trying to pay off the bills on your own. We started out at a 100% plan at initial consultation, read a lot and had our attorney work with us to get it to a 65% plan, which was still great compared to what we had been doing, then with a job loss mid-plan it is now at 40% payback after a modification. But even if we did have to pay the 100% back, I would have done it, the relief of having it all taken care of, and the forced fiscal responsibility that comes with having no available credit was really important for us, especially in the 1st couple years. Now it's old hat for us, don't know how we didn't budget before!

[BKchapter13]

one day at a time, schedule your month like you would schedule your budget, do things affordable every weekend and I dont I find it fun now to find different ways to save money and watching my savings grow is fun.. lol.. I paint, draw and save, renting movies is always a cheap entertainment, we went back to board games and drives. always always remember yout ultimate goal, fresh start with no debt.. good luck and its not easy.

[bkinthecouv]

I just don't understand a 100% repayment plan with a BK. Why even file BK then..

That's just debt servitude imo and you are wrecking your credit just for the privilege of paying 100c on the dollar out to your unsecured creditors. The absolute highest repayment plan I would accept in ch 13 is 50% and even that is ridiculous. Get a new lawyer or come up with a different plan and bolster your expenses.

Some people need a 13 to take care of mortgage arrears or back taxes and the 100% payback is a result of them not having a significant amount of unsecured debt.

[sharina]

I just don't understand a 100% repayment plan with a BK. Why even file BK then..

That's just debt servitude imo and you are wrecking your credit just for the privilege of paying 100c on the dollar out to your unsecured creditors. The absolute highest repayment plan I would accept in ch 13 is 50% and even that is ridiculous. Get a new lawyer or come up with a different plan and bolster your expenses.

Sure, easier said than done. We pay 100% because that is what the form said we had to pay. By the time we were into all this, we had been advised to stop paying credit cards. How do you turn back when every card has now been jacked up to 30% interest? The one good thing about 100% is that they do not scrutinize your expenses and you can have more budge room depending on how much you owe.

Yes, it does sometimes feel like debt servitude and it is terrible that someone can pay 100% back in a chapter 13 and no credit advantages are gained by it. And we are in the process of contacting our attorney for a modified plan, albeit, still a 100% plan.

BUT Don't call something ridiculous unless you know all the particulars - it's not as if we are happy about the whole thing - just a business decision to get out of debt in less than 30 yrs and stop feeding credit card greed.

[sheilaE]

Thanks Flamingo. The shoe part made me smile, but yeah, I'm kind of excited to just get going on this. I think the not knowing part is whats worse. I'm going to love working with cash on hand and never, ever having to pull out a cc to gas up the car.

[Flamingo]

After going through the entire Chapter 13 scenario and now being several years past discharge....to the OP - right now with everything laid in front of you, you are like a deer standing in the middle of the 8 lane Interstate with headlights bearing down on you. It's scarey, it's emotional. What you need to do and what is going to be very hard for you to do is a lifestyle change to ensure you get through a Chapter 13. That is the most difficult thing most people face when going into a Plan and being unable to change that lifestyle is one of the biggest reasons why a Plan may fail. Learning to live without credit cards has got to be one of the most scariest things for someone who does not know how to budget nor handle cash always relying on the available plastic cash from a credit line. That stops...you will need to learn to live on a cash only basis. That is important for you to figure out where you went wrong and how to fix it. Right now it's a mess but it is fixable believe it or not. You will see what I am saying several years down the road when it's over. You need to learn to budget, to do without, save, save, save, shop bulk/discount, learn to say "no" and learn that you can actually do without that pair of shoes in six different colors. After a while you will not want to see another credit card again.

I have always stated in this forum that I believe everyone should go through a Chapter 13 as it is the best budget teacher ever.

[sheilaE]

Thank you everyone-received some great advice. I'm taking notes and really appreciate the great advice I'm getting-everyone is so nice

I know we can do it and I'm hopeful when I hear that it's not meant to leave people completely broke each month. Hopefully our 5 years will fly by and then we can celebrate! We've already been living pretty tight for the last 2 years,so we're kind of use to it already. 2 years ago is when it seemed like our cc bills sky rocketed.

As far as the payback amount-I'm confused by that as well. Who decided if you pay some, half or 100%? What is the formula to figure that out? When the Lawyer told us it might be in the ballpark of $1300.00 per month-was that 100% for $80,000.00 worth of debt?

Yesterday when I spoke to the Lawyer (whom we like) he suggested we wait and file once we receive a judgement/summons. I guess it will buy us more time without the cc payments. I will be stocking up my pantry with the extra cash

I'm learning soooo much from this forum! Thanks again!

[tigergem]

I just don't understand a 100% repayment plan with a BK. Why even file BK then..

That's just debt servitude imo and you are wrecking your credit just for the privilege of paying 100c on the dollar out to your unsecured creditors. The absolute highest repayment plan I would accept in ch 13 is 50% and even that is ridiculous. Get a new lawyer or come up with a different plan and bolster your expenses.

I concur. I think in this case, I would sock away the amount that I would expect to be paying in to the plan, and I would attempt settlements first. Maybe. I dunno. I suppose with the possibility of lawsuits and ongoing collection calls, maybe not. There are arguments to either way. To each their own.