How can you repair your credit while in CH. 13?

[Ezrin]

If my plan get's approved, I will be paying back $279 every month for four years. I know it's going to be hard, and the only thing that'll keep me going is hoping when last payment goes through, I may have good enough credit to rent a decent place by myself (i'm currently renting a dump with 3 other roomates, but it only cost $350/mo), or hopefully buy a place if i'm married by then. So for the four years I will be just looking forward to when this ends and I'll hopefully be financially sucessful.

My question is what are you guys doing now to improve your credit? Can anything be done? Do we just have to wait for the negative information on our credit reports to drop off?

[Rob-NC]

Being that all disposable income is supposed to be going into the plan, I found it rather difficult to rebuild ANY kind of credit. Forget about buying a car while in your plan.

I even went through the trustee and had been approved by him and the courts to "incurr new debt" to purchase a vehicle while in the plan. GREAT, only problem, is that NO car dealership will deal with you.

I would suggest maybe trying to get a "secured" credit card with a couple hundered dollar limit. use it and pay it off each month. At least this way, you will have at least 1 good current credit history.

[Ezrin]

Thanks for the info Rob-- I see that your BK is discharged. How are things for you now? Are you able to get an unsecured card or any type of loan? Did you notice if your credit rating is much better?

Being that all disposable income is supposed to be going into the plan, I found it rather difficult to rebuild ANY kind of credit. Forget about buying a car while in your plan.

I even went through the trustee and had been approved by him and the courts to "incurr new debt" to purchase a vehicle while in the plan. GREAT, only problem, is that NO car dealership will deal with you.

I would suggest maybe trying to get a "secured" credit card with a couple hundered dollar limit. use it and pay it off each month. At least this way, you will have at least 1 good current credit history.

[anonymuse]

Ezrin, even though you can't really do much to improve your credit, you can still do stuff to clean up your credit report. Make sure all three look like each other. If there's a credit card you had with good history that isn't showing up on one report, make sure it's on there. If there are negative items that are on there that have been on there too long, get them corrected. My credit report showed my job as the one I had 2 jobs ago--for whatever reason, updating my job to my current one, raised my score 10 points. There were some work addresses listed as my home address. I started cleaning up some of that stuff now so that when I do hit that wonderful "D" day, then all I'll have to concentrate on is making sure things are correctly coded as IIB and not as charged off.

[Rob-NC]

Anonymuse has some really good points/info. and Im in the process now of disputing just about everything on my credit reports.

My credit report stayed pretty much the same throughout the entire plan. I think my highest rating right now is a sad 583. but hey, that will improve once I start getting some of the stuff on the reports fixed the way they should have been.

I would say the biggest test of getting a loan will be within the next 60 days when I will have to re-financing my home or sell it to get the ex-wife's name off it.

[Armmick9]

Rob congratulations on finishing your Chapter 13. Did you encounter any problems along the way? Or was it pretty much smooth sailing?

[Rob-NC]

Armmick9,

There were a few problems along the way. I had made the arragements to pay a vehicle outside of the plan. Well about 3 years into the plan (roughly) they started squawking that they werent receiving payments and were petitioning to lift the automatic stay on the vehicle.

Well, I produced bank receipts etc that they had received every payment that was due to them. They still bellihooed over it. So I told the trustee and my lawyer just to give them the stupid thing. It was racking up the miles anyways, and if they wanted it that bad so be it.

I think that was the ONLY glitch in my entire plan (except for the divorce) but the rest was smooth sailing with the trustee getting his payment through autodraft.

[LostOne0069]

I would suggest maybe trying to get a "secured" credit card with a couple hundered dollar limit. use it and pay it off each month. At least this way, you will have at least 1 good current credit history.

You can't get ANY new credit without the trustee's approval until your case is done... meaning discharged... which would be 4 years away. Getting new credit... especially a credit card might get your case dismissed.... which would be bad.

[$$only4ever]

I am currently in a chapter 13 and did just what anonymuse did. About a year after I filed, I reviewed my credit reports. The creditors who said that I was "bad debt; charged off , I disputed because I was never late to any of my creditors. The creditors who reported me late after the date I filed I also disputed. Many of those entries were deleted. I just have to wait until the discharge and then finish cleaning up the rest so the reports look okay on the other side. I am paying a vehicle outside of plan and a Parent/Plus loan so these are positive ratings. Verizon reports to the credit bureaus monthly, so right now I have one trade line that states current; never late.

[13inOR]

I would not even get a secured card with a low limit without prior approval, its not worth the risk of a dismissal.
Theres not a whole lot you can do to begin rebuilding while in a chapter 13, but keep in mind that mortgage lenders will look at your payment history to the trustee when you refinance or try to buy a home, and if you paid on time, it can REALLY help. So even though the trustee doesnt report to the credit bureaus, that is still a positive payment history if you need it.

Our report stayed pretty much the same, we were discharged and closed in May and June of 2006, so I now have to start cleaning up my cr's. I know one is showing a charge off which of course its not, as we had a 100% plan and they got every penny they were owed.