Filed chapter 13 but haven't had creditor meeting. Can I withdraw????

[lilloarin]

Hi! I filed chapter 13 in June, mainly to strip a second and pay some back taxes, that's it. I am since regretting it because a) I could probably just quit paying the second and hope for a settlement as there is no equity and b) I only owe about $10k in taxes, which I could do a payment plan; and c) since initially filing, our income has increased and thus increasing the monthly payment significantly, even more than what I owe on my second now. Having said that, my attorney has not submitted our financial info to the trustee yet and our meeting is not until Sept. Can I simply withdraw my case without it negatively affecting my credit? Any advice is much appreciated. Thanks!

[SMinGA2]

Yes you can stop the 13. By either your attorney filing to dismiss. By skipping the 341. By not making your payments. Those will ultimately result in the case being dismissed, ending the automatic stay and such.

But its already affected your credit. Within a few days (maybe less) of filing the bankruptcy was added to your report. A dismissed 13 can in my opinion be worse than anything else. If you apply for ANYTHING in the near future, they'll know that you could and might refile at anytime and that will make creditors leery. As time goes by, that factor will lessen. In order to 're-establish' credit, if that is a concern, you may need to open a secured credit card or deal with subprime lenders. Also any accounts you had have likely been closed either a) when they received notice from the court that you filed or b) if you failed to list creditors, they'll see the BK on an account review and close the accounts.

Ultimately you have to decide what's right for you. I speak from a little experience. We rushed too soon (in my opinion) into a ch. 13 and filed in 12/09. Had it dismissed in 3/10. Never reached confirmation and I don't regret dismissing. May ultimately still refile ch. 13 or even 7, but at this point we're in a holding pattern. (Old creditors are dormant, and we're in good shape on current finances.)

[kornellred]

Be advised that you will not be getting your money back from your attorney. Ain't no such thing!

[HHM]

If you already filed, you might as well finish it. At least with the 13, it brings you absolute certainty as to outcome.

As to "settling" the second, the only settlements that are granted with any degree of certainty are for people who filed chapter 7 BK and discharged their personal liability on the mortgage. If you try to settle and have not discharged your personal liability, it is very difficult to get a settlement that makes sense because the bank is still going to want you to pay.

Also, any credit damage is already done, the act of "filing" BK is the triggering event, it is largely irrelevant whether you finish it. So, since you already took the credit hit, and you will have a 100% chance of stripping the second in a chapter 13, stick it out.

[lilloarin]

So thankful to all for this information! The monthly payment proposed is even more than what I am paying now due to a bonus check I received. I'm worried that if I commit, I will be in worse shape. What started as $341/month has gone up to $1,200/month, increasing over time. My second is only $975... Do trustee's actually review bank statements as this only showed up on one bank statement in increments of 3 checks.

[ValleYum]

So thankful to all for this information! The monthly payment proposed is even more than what I am paying now due to a bonus check I received. I'm worried that if I commit, I will be in worse shape. What started as $341/month has gone up to $1,200/month, increasing over time. My second is only $975... Do trustee's actually review bank statements as this only showed up on one bank statement in increments of 3 checks.

There was a Supreme Court decision ( Hamilton v. Lanning) which essentally states that Trustees should use a forward looking approach in determining DMI. If your bonus was a one time only thing, you should ask your attorney about that.