Horror Stories

[nervousSC]

Help, I need some advice. All of the stories I have read here have made me extremely nervous and now I'm confused about what to do.

I am a single parent who receives NO child support. I bought a house last year so I don't have much equity in it. My car is valued at around 5K so I have to claim 13 because Trustees only allow 1200.

So at the end of last summer I started going to consumer counseling, a reputable, non-for profit associated with United Way. My payments were 380/month. However up until last week the creditors had not received my proposed plans from ccc and ccc claims they were sent. In the end my payment rose (all because of paperwork issues) to nearly 500/month, which I cannot afford. So I talked to an attorney and she figured my 13 payment would be around 200 for 36 months. But now I've read these stories and the payments are SO high, it is quite honestly making me scared about what to do.

Here are my questions:
1. What happens if my living expenses on the sheet exceed my income? (It doesn't but it's SO close)
2. If I stuck with CCC would it have the same effect on my credit as if I had gone thru 13?
3. I read here that 13 took longer than 7 to go off the credit report...is this right? I was told by my lawyer that once I finished my 36 months it would only be on the credit report for 4 more years.
4. Is a purchase at rooms to go considered secured if I use a Rooms to Go credit card? (What about Best Buy? - I bought a printer last September for 250).

I really want to stop drowning, is there light at the end of this tunnel? Has anyone had any positive outcomes from filing 13?

Thanks!

[STEPH1079]

Hello!
I am new here, but I will try to answer some of your questions.

1. First things first. If you decide to file a 13, get a lawyer and a reputable one at that. They will go over all of your finances with you, and do an expense sheet with you as well. The Trustee will want ALL of your income that is left after bills (mortgage, car payment, etc) are paid. We were able to "cushion" our expense sheet with the help from our lawyer. For example, if I thought we spent $500 a month on groceries, we put down we spent $650. Something like that won't raise any eyebrows, as long as it seems accurate enough.

2. I don't believe anything is worse on your credit report than a bankruptcy. I am still uncertain as to how your payments through CCC were raised. Were your creditors not getting any payment through them at all? A bankruptcy on your credit report will definitely lower your score. But think about it..you said you can't afford the $500 payments now, so non payment will also reflect badly. Besides, if you file a 13, they will be repaid, and after 7 years the bankruptcy will be off of your credit report. If you don't file the non payments will continue and it will just be a downhill spiral.

3. I was told the opposite. A 7 will be on your report for 10 years, a 13 will be on it for 7. A 13 takes longer to be discharged from than a 7, since you are on a repayment plan. You don't pay anything back in a 7, therefore it is discharged rather quickly.

4. I believe both of those are considered unsecured. The only thing that is secured is your house, car,etc.

Best of luck to you in what you decide!!

[keepmine]

Would you qualify for a Chapter 7?

[SinkingFast]

Which Ch you file, 7 or 13, will depend on your income, the Means Test, and your needs. There's several variables to deciding which way to file.

Just because your car is worth more than your exemption limit doesn't mean you have to file Ch 13. If your car is older, high mileage, the Trustee won't likely be interested in it. Are you getting $5K for a value based on what?? Don't immediately think your car is worth top dollar for BK purposes. Look in the newspaper. See what other private individuals are asking for comparable cars.

Check out http://www.edmunds.com. Edmunds takes into account variables that Kelly Blue Book and others don't. Some colors of cars sell for more than others. Same model, mileage, etc. Color can make a price difference.

If the Trustee does decide to try to go for something as far as your car is concerned, the Trustee will probably come up with a $$ amount he/she will be happy with and allow you to buy back that amount from the Court. You'll have your $1200 in exemption on it. Say it's really only worth $3K for BK filing purposes. The Trustee could let you pay the difference in payments.

You house could be totally covered, even in a 7, with your Homestead exemption. Especially if you have little to no equity.

Purchases made on store cards can indeed be considered secured. It will depend on the fine print in the retail Credit agreement and if the Creditor wants to pursue it or not. It will also depend on the dollar amount of the purchase. $250 may not be worth the attny's fee. Something larger, like $2000, is a different story.

[nervousSC]

I have seen three lawyers, one was kind of shady and the other two seem pretty good. Thanks for the tip on helping to up my expenses...one lawyer actually gave me an acceptable range for some things, she thought some of my expenses were way too low, I thought I was supposed to look responsible and show that I could be frugal on the expense sheet....apparently that it not the way to do it?

[nervousSC]

I have my mortgage..133000, which is current am ok with that. I have student loans near 90000, which won't be discharged but are currently in deferment. My CC debt is around 25000. My car is a 98 Honda Accord LX and to quote an attorney, the trustees here in SC are getting really nasty about cars taking anything and everything that is worth more than 1200. I could allow them to take it and buy it back, but I don't have the ability to come up with the difference immediately. The attorneys charge 3000. My car is a 98 Honda Accord. If anyone knows of a cheaper (good) attorney in SC or has ANY suggestions for me, they would be GREATLY appreciated!!!

[13inOR]

You asked if anyone had a favorable outcome, and I feel that we did. I mean,
its not really fun worrying about extra expenses, but if you think about it, most people teetering on the edge of bk probably have maxed out cc's anyway, so they still dont really have a safety net either.
We were in ours for 19 months before paying off early (100% percent plan, so we could do that) and all in all it wasnt bad . Our payment was over $1300 but we both work fulltime.
A lot of people on here have freaked out at the possibility of having to pay back 100% but it doesnt happen that often, a lot of people on here are paying just a fraction of their original debt. We just happened to have that much in disposable income. We could have doubled up on our mortgage easily for a while, but the mortgage co wanted it all right then, thus our filing 13.
We dont regret it for a minute, it was a huge relief because we were able to save our home, get our bearings, and move on.
A good attorney will help you maximize all your expenses to the amount that is fair and reasonable, and that will help a lot.

Oh, and I dont know anything about SC, but $3000 sounds about right for a chapter 13. Ours
was actually $3500, and she was worth EVERY PENNY! We only had to pay the $500 retainer and the filing fee which I think was around $125 or so up front, and the remaining $3000 was paid out of the plan, and the attorney is paid first.