so, in a 13

[Hileman]

I thought I understood this, and I may, but just wanted to ask.

When we go in and file our 13, we go to the 341 hearing, and then on my credit report, when do things start showing up as IIB? Will things start saying that after our 341? or after we pay the 3 year plan off? When will we be able to start doing things to increase our credit scores?

[SinkingFast]

I can only help with part of your question.

You can't take on any new debt while you're in a Ch 13 plan. Just 2 things. You can buy a home and you can buy a car. Both require approval by the Trustee. You'll have to be in the Plan for a year and you'll have to be current on all your plan payments as well. You'll have to apply with the Trustee, in advance, before you can buy a home or a car. The Trustee will have to approve the $ amount borrowed, the interest rate, and the payment amount, all before you make the actual purchase. If you buy a home while in Ch 13, the mortgage payment will have to be less than what you currently pay in rent. That's to allow for maintenance and repairs of the home.

You can't get any new CC's to help rebuild your credit. Anything you're paying for that the payment is included in your Ch 13 Plan, you won't get credit for those payments in your Credit History. If your mortgage payment and/or car loan go into your plan payment, it won't show on your Credit History like regular monthly payments made the normal way.

How what's posted when by the Creditors and the CRA's in your Credit Reports, I'm not sure.

[aa06a47]

Sinkingfast, if you have a first and second mortgage outside of the chapter 13 payments, those will still show up as positives on your credit report..right? Am curious as to how much that will help the credit score by the end of 5 years?

[13inOR]

We paid our first and second mortgages ourselves, outside of the chapter 13, and those did record on our credit history just like they would have otherwise.

But like SF said, you can't take on any new CCs while you are in the plan and
trustee has to approve a car or home with restrictions and guidelines.

Also, even though you technically don't get credit on your report for your payments to the trustee, that record of regular payments to them goes a long way if you want to apply for a mortgage or refi when you are done. For example, it made the difference of us getting an interest rate of 7% to payoff our 13 versus 10.4%, because they used that payment history as part of the whole approval process. So, it can still be helpful in a way even if it doesnt report in the traditional manner.

[aa06a47]

We paid our first and second mortgages ourselves, outside of the chapter 13, and those did record on our credit history just like they would have otherwise.

But like SF said, you can't take on any new CCs while you are in the plan and
trustee has to approve a car or home with restrictions and guidelines.

Also, even though you technically don't get credit on your report for your payments to the trustee, that record of regular payments to them goes a long way if you want to apply for a mortgage or refi when you are done. For example, it made the difference of us getting an interest rate of 7% to payoff our 13 versus 10.4%, because they used that payment history as part of the whole approval process. So, it can still be helpful in a way even if it doesnt report in the traditional manner.

Glad to hear some things you do in bk helps.