Thought I was finished with my 13- Think Again....

[NotFinished]

Hello Everyone-

Just wanted to share my FRUSTRATION here as I hope many of you may relate. Maybe even help or clear the air with CORRECT information as well.

Here goes- a little background..

I filed my Chap13 in NOV2003. It took a while to go through the motions and stuff. I paid $900+ every month on my 5 year plan. Finished it off and FINALLY in AUG 2009 I was discharged. Sounds Great- Right? Well.... Here is the kicker--

My assumptions-
1. Pay through my plan and after 5 years it would be gone. After 7 years its off my credit report and I am finished.. // Told repeatedly that its on for 10 years- I read 7 in multiple forums- WHATS correct??
2. I needed to pay this as I am a person of Character and need to pay my debts. / Reality- The loan officers dont care if its a 7 or 13- if you filed, they look down on you..


So Last month I went to the bank looking to see what we need to do to get a construction loan/house loan- Investigating really but seriously as well.. After the 3rd Bank told us the same thing I said this is crazy. They all told me that I have to wait for 2 years past the discharge date (Their policy I assume). I couldn't believe it. I also needed to raise my score as well- It was 629 at that time. So my discharge date is AUG2009- That would be from Nov 2003 through AUG 2011.. BUT if I did a Chap7 it would be Nov 2003 to Aug2005 (something like that).

SO I got some low balance credit cards in my name to help build my score. 1 has a $250 limit/ 1 has a $500 limit. I am trying to build my score up so I can build a house.

So today my credit score is 650, my wife's is 735. I make over $100k a year. I have a total of $1800 a month in TOTAL bills (everything minus food). I have over $3500 a month clear and free. -I am NOT bragging- I am frustrated. Keep reading please...

I call the bank and see if I can get an unsecured loan for $8000 or any amount that I can qualify for. They denied me and said AGAIN- It has to be 24 months AFTER the DISCHARGE date. The loan officer mentioned that I could do a "secured loan" using my money as collateral. I bluntly asked her that even if my score was a 750 right now, and have over $4000 a month NET income for my household, could I qualify for ANY type loan- secured or unsecured. She saw my point and said NO. the BIG N O ...

I paid over $70000+ back through my chapter 13 plan. I am glad I did as my character means a lot to me. BUT COME ON... If I did a Chap 7 I would be in a new house right now and have a credit score of 700+ Guaranteed.. Plus have $70k in the bank.. Banks (most that I have dealt with anyway) need to look at the big picture and see that not all Chap 13 and BK in general are not due to the people's fault and most try and do the right thing. Banks Need to really differentiate between the Chap7 and Chap13 people. I can tell you first hand- THEY LOOK AT YOU NO DIFFERENT THAN A PERSON THAT FILED A 7... You are still looked down on. One Loan officer stated that she filed a 7 and they built a new house not even 1.5 years after she filed.. ITS RIDICULOUS... She told me we should have done the 7.

--For those that wonder why I filed to begin with, It was due to Medical bills and VERY BAD ADVICE from a BK Lawyer. (Look at all of your options and make an educated decision- not like us)


So I ask Am I totally by myself here? Is this the NORM? Is there any Banks out there that are CHAP 13 friendly?? Either for a typical loan, or a construction/house loan.

I know CASH is KING but its hard to buy a house with CASH.

ANY ADVICE??

Thanks....

[ColoradoBell]

It's just awful that after all this time, you can't get a loan.
I thought I read that if you pay your Ch 13 payments on time for a year that you can qualify for a HUD loan. Have you tried there?

[MOMof3]

Well, I haven't completed yet, but that sounds very frustrating! It is supposed to be off your report after 7 years in a chapter 13. I think that is 7 years from your filing date, so in November 2010, it should be OFF your reports! At that point, I would make sure it is gone. Once it's gone, you shouldn't even have to mention it again & it shouldn't impact you anymore. I would try a different bank, sounds like they don't know the difference between 13 & 7.

[screwedupbyRE]

here's what I know and was told by my attorney:

Chapter 7: takes 10 yrs from the date of discharge
Chapter 3: takes 7 yrs from the date of discharge

New loans: You must wait at least 2 yrs (after the discharge) before applying for any loan.

Your FICO will be back on track after 7 yrs of "discharge" date. Not the "file" date.

[needanswers]

here's what I know and was told by my attorney:

Chapter 7: takes 10 yrs from the date of discharge
Chapter 3: takes 7 yrs from the date of discharge

New loans: You must wait at least 2 yrs (after the discharge) before applying for any loan.

Your FICO will be back on track after 7 yrs of "discharge" date. Not the "file" date.

Wow, so a Ch. 13 will stay on our credit report for 12 years if we are in a 5 year payment plan? I always thought it was 10 years max.

Can someone confirm this is true?

[jange]

Everything I have read, Chapter 13 is 7 years from the filing date not the discharge date.
Ch 7 is 10 years from the filing date.

[Exployer1234]

On the information I received from my lawyer on Chapter 13 it states that creditors can start to drop information on your credit report starting at 7 years, but some may not and wait until the 10 year mark.

[jange]

From the equifax website:
Public Records

Judgments remain on file for seven years from the date filed, whether satisfied (paid) or not
Paid tax liens remain on file for seven years from the date released (paid)
Unpaid tax liens remain on file indefinitely
Bankruptcy
Chapters 7, 11, and non-discharged or dismissed chapters 12 and 13 remain on file for 10 years from the date filed
Discharged chapters 12 and 13 remain on file for seven years from the date filed

[df04527]

Reporting SOL starts on the Date filed for everything EXCEPT tax liens.

Avoid tax liens of any kind. They are evil.

Also - on the lenders requirement regarding being 24 months post discharge. Lenders can set any additional requirements they want -- Keep looking.

[sharina]

Chapter 13..what a joke. Pay it back and be punished for an undetermined amount of yrs. makes no sense at all, but that's our gov't hard at work.