*live in North Carolina*
We filed for Chapter 13 almost 3 years ago. We had $47K in unsecured debts - credit cards, medical etc. and a motorcycle we surrendered. We also had a one year old car and another motorcycle (both secured debts) that we placed in the bankruptcy. Our mortgage we exempted from the bankruptcy and decided to pay for outside of it.
In September of last year we hit trouble. My husband's employer decided since he was struggling financially he would keep the employee group insurance premiums and let their health insurance policy lapse. My husband decided to find other employment which he did but he took a huge cut in pay but we would have health insurance again.
Because of his pay decrease we started struggling to make the bankruptcy payments so I called our attorney and asked about filing for a payment modification. The trustee granted it but only lowered our payments by $150 a month (we lost over $1,000 a month in income). We made a couple of the modified payments.
Three weeks ago I wrecked our car when I slid on ice and hit a light pole. We hoped they would total the car because we owe $11,300 on it but we have GAP insurance so the debt would be canceled out. Unfortunately they decided to repair it at 65-70% damaged.
I called our attorney and explained the situation to him. He suggested we convert to a chapter 7 and discharge the unsecured debt and surrender the car since it won't be worth much now and we were struggling to pay the chapter 13 payments anyway.
We thought about reaffirming the motorcycle but they want $1,000 cash plus paying the original payment $350 a month for 2 more years. We've already paid 9 years on the bike (including before the chapter 13 & the 3 years in it too). It would be crazy to pay 11 years on a motorcycle loan.
So we've decided to surrender both the car and the motorcycle and discharge the unsecured debts so we can start over fresh. But I do have some questions and worries.
We pass the means test (according to what I've researched online) but what will happen with our mortgage since we are converting from the 13 to a 7? We really want to keep our house, we're current on the payments and again it was not a part of the chapter 13.
Also I have a motorcycle that was given to me as a gift after we entered chapter 13. It was a wrecked bike, it's not road ready but I do carry insurance on it since my homeowners won't cover any damage to the parts. It is worth blue book value about $6,000 but it's no where near that market value since it's basically "basket parts". Do I need to tell my lawyer about it?
We're assuming this conversion is a good thing for us? If so what are some questions I need to ask our attorney? Any suggestions would be appreciated.
Thanks in advance.
We filed for Chapter 13 almost 3 years ago. We had $47K in unsecured debts - credit cards, medical etc. and a motorcycle we surrendered. We also had a one year old car and another motorcycle (both secured debts) that we placed in the bankruptcy. Our mortgage we exempted from the bankruptcy and decided to pay for outside of it.
In September of last year we hit trouble. My husband's employer decided since he was struggling financially he would keep the employee group insurance premiums and let their health insurance policy lapse. My husband decided to find other employment which he did but he took a huge cut in pay but we would have health insurance again.
Because of his pay decrease we started struggling to make the bankruptcy payments so I called our attorney and asked about filing for a payment modification. The trustee granted it but only lowered our payments by $150 a month (we lost over $1,000 a month in income). We made a couple of the modified payments.
Three weeks ago I wrecked our car when I slid on ice and hit a light pole. We hoped they would total the car because we owe $11,300 on it but we have GAP insurance so the debt would be canceled out. Unfortunately they decided to repair it at 65-70% damaged.
I called our attorney and explained the situation to him. He suggested we convert to a chapter 7 and discharge the unsecured debt and surrender the car since it won't be worth much now and we were struggling to pay the chapter 13 payments anyway.
We thought about reaffirming the motorcycle but they want $1,000 cash plus paying the original payment $350 a month for 2 more years. We've already paid 9 years on the bike (including before the chapter 13 & the 3 years in it too). It would be crazy to pay 11 years on a motorcycle loan.
So we've decided to surrender both the car and the motorcycle and discharge the unsecured debts so we can start over fresh. But I do have some questions and worries.
We pass the means test (according to what I've researched online) but what will happen with our mortgage since we are converting from the 13 to a 7? We really want to keep our house, we're current on the payments and again it was not a part of the chapter 13.
Also I have a motorcycle that was given to me as a gift after we entered chapter 13. It was a wrecked bike, it's not road ready but I do carry insurance on it since my homeowners won't cover any damage to the parts. It is worth blue book value about $6,000 but it's no where near that market value since it's basically "basket parts". Do I need to tell my lawyer about it?
We're assuming this conversion is a good thing for us? If so what are some questions I need to ask our attorney? Any suggestions would be appreciated.
Thanks in advance.
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