Emergency petition to stop repo -did we do the right thing?

[justmyluck]

We filed an emergency petition to stop a auto repo and are now questioning if a ch 13 is the right thing. Are thinking about dismissing since we have not filed our payment petition yet. Meeting with attorney tomorrow have only seen paralegals so far!!. We are not behind on any credit cards (7k) and only one mortgage payment behind. Just behind on the auto 3 months. We owe 21k and auto only worth about 16k max. So confused on what to do???

[SMinGA]

From the info you posted, its hard to answer your question.

What is your net income monthly, and expenses? Both bills (mortgage, insurance, utilities, etc.) and spending items like groceries, gas, household needs, etc.?

Are you above or below median for your family size/state?

What is your home worth, what is your balance? Is that there a 2nd? What is owed if so? You said $21,000 owed on the car. You said you're behind by 1 month on mortgage. How much per month? Do you mean the month of July or August? When exactly did you file the ch. 13 petition?

Whether you dismiss or not, the filing of the BK will stay on your credit. Your credit cards likely will be closed.

[momofthree]

This was really something that needed to be more thought out. You've already filed. You can dismiss your case, but that doesn't make the bk go away. It will be on your credit for the next 7 years, even if you never complete it.

Filing to keep a car that is $6k+ underwater, and having very little other debt wasn't exactly a wise choice. Especially since you're now on the hook for probably around $3k-$4k in attorney fees.

What kind of payment are you strapped to and for how long (36 or 60 months)? You may want to consider converting to a 7 and surrendering the car. You would have to bring your mortgage current though if you convert to a 7.

Good luck and keep us posted.

[justmyluck]

Our net monthly income is 2000-2500. Husband on commission and varies monthly. Monthly mortgage 800 and auto is 695. Total expenses around 3500/month. We are below median income for family of 4.

Our home is worth 155k and we owe 118k. No 2nd mortgage. We missed July payment (800)and have made the August payment because our lawyer told us we had to if wanted to keep it. Filed emergency petition on July 28th.

Thanks for any advice!

[SMinGA]

From the little you have posted: it would be impossible for you to get a plan confirmed. Your expenses exceed your income, it needs to be the other way around.

Your car payment is ~1/3 of your net income. LET THE CAR GO. Find some other form of transportation even if its a car you can pick up for a few hundred $ to get you thru a couple of months. Talk to your atty about converting to a ch. 7, let the credit cards and car go in the bankruptcy.

Ultimately look for ways to increase your income, and save up for a more reliable long term car. Even on higher income, $695/mo for a car payment is harsh.

Edit: on the home, you'll eventually need to catch up on the July payment. Depending on what state you're in, you may be exempt the equity.

[momofthree]

What state are you in? Are you able to exempt your home equity? Are you able to cram-down the auto loan (bring the amount owed down to market value) or lower the interest rate? Being under median, you have the option of a 36-month plan. Did your attorney tell you your payment amount yet?

[justmyluck]

If we let the car go back - can't they sue us for the difference after they auction it off? There is no way they are going to auction it off for what we owe!

[SMinGA]

The ch. 7 conversion would take care of that.

If we let the car go back - can't they sue us for the difference after they auction it off? There is no way they are going to auction it off for what we owe!