How many successful Chapter 13's out there?

[minan]

A successful completion here! Just received the official discharge papers in the mail yesterday!

My bankruptcy was uneventful, but unfortunately life did not follow suit. The trustee in our district is busy and therefore not involved in some of the micromanagement I've seen others experience on this site. We are not required to submit tax returns after confirmation, and are allowed to keep the tax refunds (ours were always under $600 anyway). Also they only request you notify your attorney if your income increases more than $15K (which unfortunately was not us). Our plan was confirmed with no objections and was for a 10% payoff to unsecured, and in this district payoff percentage DOES matter, and early payoffs are allowed. I know this is not supposed to be the case, and there are many threads here that point to the contrary. I can assure you that is how it works in this district.

Our attorney told us that the trustee in this district will not accept anything below a 10% payoff for unsecured (he may mean without a fight, but I was okay with that), and the plan could have gone up to 47 months if all of the creditors had filed claims, since they didn't we were done at 37 and some change payments. I say change because you can request a payoff 36 months after confirmation in this district. I did make the request, and received the final payoff (which was less than the normal payment) figure, and the Trustee closed the case within 3 weeks of receiving that payment. We received the discharge order about 2 weeks after that.

Now the life part was something else, let's see, husband lost his job and was off for 6 weeks before securing another position at about a 40% loss in income. I had to take on a second job for a year to cover the difference. He had back surgery last year ($2500 out of pocket), and two months ago the transmission went out on his car. We've been sharing one car since. Also had one child in college for the duration of our 13, who just graduated, and one starting later this month. Fortunately his child support obligation was over at the same time the 13 completed.

Despite all of these things, we were never late on any payments to anyone over the course of this plan. We had some wiggle room in the budget, and were able to cut some expenses to the bone in order to make it work. Not easy by any means, but extremely gratifying to have completed despite the overwhelming odds.

Filed 5/1/07
Confirmed 6/20/07
Final Payment 6/24/10
Case Closed 7/15/10
Discharge 8/5/10

CONGRATS! That's so great for you. Enjoy.

I hope to say this same thing sometime in 2015.

[andy158]

Just completed our first year out of five and boy has it gone fast! Some bumps in the road as expected. Car repairs, appliance repairs, etc. No major surprises that we didn't budget for and our attorney submitted a very "liveable" plan. I have been abe to work some overtime which goes straight into our emergency fund which has been depleted and built back up three times already. Can't stress enough to save what and where you can. Life is much less stressd knowing it will all be over in four more years. Never would we have been able to be debt free without this. I can now actually "plan" for a retirement not worrying about making minimum payments on debt that would not go away. Good lessons learned so far and no regrets.

[sheilaE]

We haven't started ours yet, but reading about the failure rate (80/90%) is awfully scary. I mean, what other choice do people have if they're not converting to a 7? If they quit, then all the calls start back up and you owe big time right? And if so many people are failing, then why hasn't someone made it easier for people who have to file chapter 13?
Very upsetting

[mom901]

It makes me wonder too why so many fail. Is it the debtors not budgeting and such or is it changes and suprises from the trustee and lawyer?

[minan]

I think what someone said earlier about having a "liveable plan" and budgeting.

I am meeting with my atty on tuesday because my proposed plan is already set up to fail since it doesn't leave me a dime for basic living expenses. The atty keeps saying we'll revisit the plan and revise accordingly, however I don't understand how I'm to succeed if I have to dig into savings.

I'm already looking into getting a second job, etc...once I'm confirmed etc..so i can pay for food, electricity, etc..This is what is causing all my anxiety and stress.

I envy all those who have made it through their 13 or are in 13s and are able to make it. I do hope I say the same in 60 months.

[wick246]

I searched for chapter 13 failure rate and found this interesting:

http://getoutofdebt.org/7233/the-tru...and-bankruptcy

[HHM]

As was pointed, what constitutes a failure is subject to interpretation. If you just look to the the number of chapter 13's filed compared to the number of chapter 13 discharges, that provides an inaccurate picture of failure vs success. There are several reasons for this.
1. The debtor should not have filed chapter 13 in the first place (i.e, it was the wrong choice from the beginning). For example, trying to save a home that under no scenario could the person afford to keep. Poor legal representation (an attorney churning chapter 13 fees) etc. These plans rarely make it confirmation.
2. Strategic chapter 13's. These are chapter 13's that are filed that are not intended to go to discharge. These are used to stop foreclosure to allow a sale, stop a garnishment. These are the "buy some breathing room" chapter 13's.
3. Probably the biggest reason, 5 years is along time and things change. Usually some major event will occur that changes the reasons for needing a chapter 13 or the ability to stay in a 13. These plans are usually converted. Conversions, in my opinion, are not failed chapter 13's.
4. The final reason is simply lack of discipline by the debtor. At the end of the day, the debtor can have a very livable budget, but they have been living beyond their means for so long, they simply don't know how to live on a budget and don't have the discipline to change.

[Sanandlou]

We will have our last garnishment this month and it has been a very long road.

Bankruptcy was the best thing that happen to me. I rolled credit cards, title and equity loans and then refinances for 10 years. I wonder if I EVER would have learned to live within my means without it.

What got us through was a couple of raises that weren't over the percentage allowed and keeping our income tax returns so it depends where you live or your plan or whatever...

One more that can say no problems from our attorney or trustee..

This was a blessing..
and I'm JUST ABOUT FREE!

[jsperk]

My case should be down this month. I think they are doing the audit now.Our plan has went smooth.We never heard from the trustee or attorney.What helped me was a year in I was blessed with a new job and a raise and the wife got a new job and a raise in year two. Sometimes money was tighter than other times but thank God we may be finishing up.

[MOMof3]

I see the light at the end of the tunnel...

We filed in feb 07 and it has NOT been an easy road, but the bumps have been managable and despite the fact I just had a baby in January and returned to work full time, I do see the light at the end of the tunnel! We are not going to modify despite the increase in childcare because we are just so close and don't want to rock the boat. I think this time next year I will be down to the last of my payments!! Once we are done, we will have an extra $800+/month to SAVE. I think this whole thing has taught me an amazing lesson and new approach to working & spending. I think A LOT more about what I spend money on and with no credit cards, I've learned to SAVE for christmas, new tires, birthdays, etc... not just plop stuff on a credit card and make minimum monthly payments. When we are done, I imagine we will do some celebrating--and I think we deserve it--but then it will be back to a somewhat frugal existence. I plan to be DEBT FREE at some point in my life--including my mortgage! I want to also teach my four kids good money managment skills so they don't ever have to go through this hard lesson.

I've only got 17 months left out of 60 and feeling good about reaching the finish line!

[woeisme]

Next month will make us 3 years into our CH 13, I absolutely plan to finish it successfully in another 2 years.

Have there been road-bumps and problems? You Bet! But that's life, same problems would have shown up if we had not been in a CH 13, only I would have been less prepared to deal with them since being in the CH 13 has really taught me how to budget, prepare, plan, and respond to financial problems.

We started out in a 65% plan, it has since been adjusted to 40% due to husband going on disability. We were able to successfully file a motion to incur debt when the car needed replacing, will have the van we bought paid off the end of October so we can start saving up for a second vehicle. We were able to suspend payments for 3 months when the disability paperwork was being processed. I've worried and stressed a lot of things, but they've always worked out in the long run, never once considered tossing in the towel over any of it.

We've also been very blessed not to have a crazy trustee, doesn't take our tax refunds, allowed us to keep the stimulus checks that happened the past couple years, doesn't want to see our tax returns yearly, basically just wants that check every month, we send it in, he doesn't bother us. He even offers all kinds of free budgeting and debt seminars that we could attend (unfortunately they are over an hour away since we live at the edge of our district, but when we need to take the 2nd debtor education course prior to discharge, he offers it for free! Even has rebuilding credit seminars and lists of bk friendly credit places that will help post-bk with things like car loans, etc.) I've heard he has some of the highest success rates in the country with his CH-13's, and I can understand why, doesn't suck your last penny away on the budget so that if you are careful with planning and frugal, can actually save up to be prepared for those life events that happen. Heck, we are even going on vacation in October. (well, part of the trip is being paid by my job since i'm giving a talk at a professional conference while I'm there, but saved $ to take son and hubby with me to Vegas!) And this is in addition to our emergency cushion. Of course it helps that I'm about the cheapest person you'd ever meet so we spend way under our food and clothing budgets, and are 2 people with 1 vehicle (I can walk to work and hubby no longer works due to disability) so the auto expenses are real low too. If it wasn't for the medical expenses that keep cropping up, I'd feel like we had it way too easy sometimes... but then another medical crisis and there's the reality check again!

I love being totally creditcard free. That was my definitely biggest fear prior to filing, now it's the thing I am most proud of. I don't care what the VISA and MASTERCARD commercials say, you can live your life, travel, rent cars, check into hotels, whatever, totally on cash. Don't believe that you can't. And knowing that every year I am NOT digging the debt hole deeper, in fact in 2 years will only owe on my house and student loans, is awesome! There are definitely days I wish we could have filed or converted to a CH 7 and have this done with already, but I really believe that if I had done that from the start I would have gone back to my old spending ways real quick. CH 13 is harder, but in my case, I needed the tough lessons it has taught.