Hello again....BKF friends

[editordwc]

It must a February thing, but I am finding my way back here again ( I see a few familiar faces !) Its been three years since my CH7 was closed, but my previous job, a job switch by my spouse put us in a fast-moving spiral thats got us back in the swamp...we got into quite a bit of payday advance trouble to make ends meet before I got my present job (with the railroad and hence my income has jumped considerably)....just when things were starting to look good, the payday loans bit us and now we are both looking for direction...we will be meeting with our atty next week...My first question: Its still too early to file for Ch13 isnt it? thanks in advance and hopefully we can see the return of the Happy Mice Dance soon !!

[SMinGA2]

From your signature, you filed ch. 7 on 11/11/08. In order for your ch. 13 to lead to a discharge of debts, there needs to be 4 years between filings.

When you meet with the attorney next week - discuss closing your bank accounts/opening new bank accounts due to the payday loans. They will pursue you for collection, but that could help you get your immediate finances back on track.

[editordwc]

We're cancelling our direct deposits from our employers this week, and plan to re-open accounts elsewhere. It suspect the bank will be uncooperative in closing our account....
Unfortunately, had to re-write this past Saturday with four PDLs to cover things, but this is that last time. Its a process, and it will be difficult, but it has to start somewhere.

[SMinGA2]

I've heard of some banks being difficult to close accounts - still allowing fees & such to go thru. Taking steps now to open new accounts & reroute your direct deposit makes sense. Ultimately, if you have a balance owed to a bank that would be something to list in your bankruptcy.

PDLs are a rough pit. We've all had moments where we make choices that seem like they're the only option at the moment. GA doesn't allow PDLs. Actually, I think its something about GA has a limit on the interest rate that can be charged - so PDL companies choose not to do business in GA.

[ValleYum]

Sorry you are back to visit... but SMinGA2's advice is dead on - make sure to ask your attorney about changing banks/closing accounts to get control back over those PDLs.

Congrats on the railroad job! Are you working as an agreement (union) employee or for the company?

Remember, if you are an agreement employee that your union dues is a mandatory deduction from your wages. Also the RRTier1, RRTeir2 and RRM deductions are in place of SS and Medicare and are also mandatory. With you being in Nebraska - you are in the home state of a pretty large railroad and your trustees may not be as puzzled as I have heard tales about.

Make sure to budget $$ for your work clothes / boots. A good pair of work boots can *easily* run $200.

The "job insurance" may sound pricey and optional but in a job where there is virtually *NO* unemployment/furlough pay and any discipline assessed against you (or by virtue of discipline assessed to anyone on your train crew!) can mean 30 days to 6 months without a check - it is almost a necessity. Our attorney listed it as private unemployment insurance and the trustee accepted it without issue.

My hubby works for as an engineer (agreement employee) for a Class 1 railroad and when the things are good the money is, too! I hate for gas prices to rise because he drives a bit to get to the yard - BUT it gets the railroad more business and hubby more work so it is one of those good bad things. LOL

Best wishes on getting things on track (haha) ASAP!

[SMinGA2]

Good advise on budgeting appropriately for work clothes. Think long & hard about where your money needs to go. Some things are easy: paying utility bills monthly for example. Other things may take a little thought. Maybe start tracking where your money goes - groceries, household items, clothing, medical out of pocket & over the counter, vehicle maintenance, gas, etc. Some things happen weekly, some things you need only occasionally. You want to go into a ch. 13 with a realistic budget, one that accounts for everything you can reasonably foresee. Then once you're in the plan, try to cut back here & there so you can save a rainy day fund. (I have some grocery/couponing tips - nothing extreme - for anyone who is interested. This has been the easiest area for me to save $.)

[Lajazz947]

All I can add is that

It must a February thing, but I am finding my way back here again ( I see a few familiar faces !) Its been three years since my CH7 was closed, but my previous job, a job switch by my spouse put us in a fast-moving spiral thats got us back in the swamp...we got into quite a bit of payday advance trouble to make ends meet before I got my present job (with the railroad and hence my income has jumped considerably)....just when things were starting to look good, the payday loans bit us and now we are both looking for direction...we will be meeting with our atty next week...My first question: Its still too early to file for Ch13 isnt it? thanks in advance and hopefully we can see the return of the Happy Mice Dance soon !!

Yes, if you wait four years from the original filing it will act as a discharge after you complete your payments.

I am in the same boat but hey, we have lots of company and great advice on this forum.

Can anyone tell us how a bank can refuse to let you close an account?

You can most certainly stop a direct deposit.

[SMinGA2]

What I've seen goes something like this: they can't close it til all activity is completed. Someone with a pre-authorized debit would mean activity has not been completed - so when they try to pull $ from your account, the bank charges a fee even though you asked to close the account.

I don't know that ALL banks do this.

Can anyone tell us how a bank can refuse to let you close an account?

You can most certainly stop a direct deposit.

[justbroke]

I don't know if it was mentioned, but you can file a Chapter 13 at any time. You just won't receive a discharge. You would need to pay 100% of the unsecured debt. The nice thing would be... no interest. The bad thing... back in bankruptcy again.

A bank can't prevent you from closing an account. Do it in writing. Mail it with certified mail return receipt. The problem will be fees associated with overdrafts and the like. Eventually, it would go to collections. The bank might allow the account to "quiesce" by freezing deposits and transfers, but allowing outstanding checks and drafts to clear. I don't see where a bank would do that for more than 30 days.

[editordwc]

We visited our local bank to open a new account and they ran a credit check and told us my credit score wasnt high enough so we were denied...I told them I would take my railroad money and run it on another track....the lady just looked up and was silent...I added that I would mention them to all my friends.....then...we went to our local credit union and they offered the same amount of services and were glad to help us open an account with them....Will see what happens at the bank as far as closing that account...Oh well, at least we can start directing our paychecks in a new direction...

In response to others, Im a union worker with a full time shortline railroad that works off both of Nebraska's major carriers....I have looked into the "job insurance" and will consider it more.

[ValleYum]

RE Job Insurance: You may not need it as much with a short-line, I just don't know. Their discipline policies may not not be as punitive as the big guys.

I just wanted to mention it - because it would be an easy thing to give up to try to save that $100 or so per month... until you got a 3 or 4 month suspension for something a crew member did and had $0 in income - that $75 or $100 per day paid by job insurance can save your fanny.

Good for you on taking your money to someone who was happy to have it!!

[karm43]

What about a second mortgage, I know its debt but im sure its lower interest. Or maybe a personal loan so it is 1 loan then stay away from pay day loans. Heck I think the finance companies are cheaper. Well if you really want to get on track maybe you can title your car for the loan so its only one. Just a thought so you can get away from this pay day loan cycle.

[editordwc]

karm43: all good ideas but unfortunately none would be workable in our situation....we rent, have no titles, and additional loans wouldnt be possible, either...

We have been working up our budget the past few days (being very conservative, too) and we are maybe finding about $50-100 to spare, this doesnt even leave us room for savings or medical...what do the courts do if theres little or no wiggle room for extra funds to distribute?

[SMinGA2]

There doesn't have to be 'extra' for unsecured. There is nothing in the bankruptcy code that says they must get a certain amount in a ch. 13.

Your concern is having enough to pay what is required... No mortgage arrears since you rent. A bare minimum would be to pay your attorney - many take part of their fee upfront & put the rest into the plan. And the trustee gets a cut, 5-10% of whatever you pay in depending on your district. Certain debts are priority and must be paid in full, but I don't know a full list of what counts there.

Do you have car loans? About how long left, and are they reliable? If so it could work in your favor. Say you have 2 years left on a $300/mo car payment. It might be possible to pay the car in your plan - and instead of having a $300 car payment, have a $300 plan payment. (If that is your only DMI, of course.) In that case, the car loan would need to be paid in full during the plan and it might even be paid at a lower rate than your contract rate. (If you've owned it more than 910 days when you file, and you owe more than its worth, you may be able to cram it down and pay only its value. That's another topic...)

[editordwc]

But since Im under my 4 year discharge window, thats another consideration, too....

We are about 8 months into a 60-month loan on two cars, combined owing about 26k, both 2009s and in good shape. Looking at approx $17k in unsecured debt combined.