Getting ready to consult an attorney…

[speechchick]

Hello all. New here and learning valuable info. My husband and I are looking into filing Chapter 13 and just curious as to what tips everyone has regarding things to do before filing(if any?). This is nerve wracking, but reading the positive posts here is a big help. Thanks.

[shipo]

The best advice I can give pre-Chapter 13 filing is to interview at least four or five attorneys and pick the one you feel most comfortable with; any money you pay them will be well worth the cost.

[speechchick]

Good to know. Thank you!

[Carmella]

I agree with interviewing attorneys and if your gut says no Run Away as fast as possible! The first attorney we saw said we wouldn't qualify for BK and wanted us to do a debt consolidation where he would call and negotiate with the creditors. This was not true and the debt consolidation would have made him more money and probably hurt us financially in the end. I would also look for an experienced attorney/group that has done many BK in your area and knows the process well.

From our experience: I would not procrastinate if the decision is made and BK is what you need to do--just do it. All and all the BK 13 was the best decision for us, but it's not a fun time. If I knew more beforehand I think the BK 13 payment years would have been a little easier. I found this forum AFTER we were in active BK 13.

Make sure your cars are in good shape. If you need to get a new/new to you car go ahead and try to get that prior to BK. We have been surviving with 1 car between the two of us and it really is not a good thing. I would also see if there's any home repairs or appliances on their last leg that you might be able to fix/replace prior to BK.

I am not saying run up debt you cannot pay off because that is not right and probably not allowed/would be questioned. If you get a car you will have to make the payment. As for home repairs or appliances you don't want to have recently charged expenses. That would be a question for an attorney so if you really need something repaired say your furnace might die before 5yrs are up I would say if there's a way to either extend it's life or replace it before BK find out the correct way to do it.

We lost a refrigerator and dryer and two cars One in an accident which we could replace during BK, but now we have a loan with higher interest and a car that won't be paid off for a while. The other car was not well maintained when we had our financial issues and now during BK repairs were too expensive. If you are involved in an accident or have a serious need during BK there are ways to get approval to take care of things, but if you can do it before it will be less of a hassle. We also had a plumbing issue that we put off repairing and had water leaking until we could afford to fix it (stimulus). Right now our kitchen sink is bad the pipes beneath has makeshift fixes that work for the time being.

If you and/or your husband are handy with fixing up stuff some repairs won't be so bad--not as expensive so that's something else to consider. I would check around your home and see if there's any troubled areas. Not cosmetic/outdated, but the things you really need. Then you can plan or nip it in the bud. This would be ideal, but if you are in the same/similar situation like we were it would have been hard to tackle problems because our debt was overwhelming. Though I bet we could have gotten a car since our credit was good even though we were basically broke!

I wish you well with the process find a good attorney and keep us updated on this forum!

[shipo]

Carmella touches on a very important point; if your cars required for work are getting older, it is best you upgrade them to new(er) before you file; many attorneys will give you this advice, some will not. Mind told me to buy a new car and I, in my infinite wisdom, failed to follow said advice, much to my detriment. I started my Chapter 13 with a (then) 14 year old car with about 150,000 miles on it; that car rusted away to nothing during my 4th year and I had to buy, for cash no less, something new; I ended my bankruptcy with, would you believe it, another 14 year old car with about 170,000 miles on it. Had I followed the advice of my attorney, I would probably have gone out and bought something like a Toyota Corolla, driven it for the five years, and then had a fully paid off asset worth well north of $10,000 when my bankruptcy was discharged.

[flashoflight]

The budget will be important. Ideally, you should be living in your proposed chapter 13 budget already and saving receipts for the trustee to verify your budget numbers. Make sure you are not skimping on expenses the trustee will accept for your pets, church contributions, home maintenance, etc. You can skimp after confirmation. If you put in the low numbers the trustee would rather have you do, you will struggle to eat. Even though I had an optimized budget, there was a time or two during the first few months when I skipped meals. Stimulus, raises at work, and the COVID lockdown made it real easy to save money and even make some pretty big repairs like replacing my broken HVAC a few months after the AC broke. My furnace broke pre-petition but I live in California, so I could live without it. I still don't have vehicle costs that are even close to my budget by working from home as much as possible. So it does get better and easier. But the first months were rough even with a tweaked budget.

[speechchick]

Carmella thanks so much for all the info. My car is a 2016 with lower miles so I’m hoping it will be ok. If I tried to trade it to get a newer car I’d just end up with one that’s not as reliable because I’m a little upside down. Husband’s is a 2019 with low miles so def not worried about his. I have so many repairs that need done(roof, new fence, etc) but no cash and can’t get any more loans. I really do worry about this. So are you saying if something like that came up you could get approval for a reduced or delayed payment or something? Or no? I know what you mean about the debt consolidation thing. Prob would not have helped. I’ve been doing debt settlement for 3 years and paid off a ton, but still a few have sued and I have judgements. I debated at the time and thought it would be better thank BK. Prob not. Found an attorney close by with like 289 4-5 star reviews and all he does is BK. Def giving him a call. Even as I’m writing this I’m still trying to find another way out. My secured loans are current, but we have a ton of personal loans, back taxes, and credit card debt. Things were bad, but we were making it and then COVID hit. My husband and I both work in healthcare in nursing homes and we got zero help. We both got pay cuts and I was dropped to part time. We were forbidden to go work at other buildings also, so we lost a lot of extra money we were making in addition to our full time jobs. Make too much money and no kids so we weren’t worthy of the stimulus checks even though hello we have bills too and a LOT of lost income. I’m already living with negative dollars every week, so really even a tight budget would be better than this I guess. This is so hard and it’s wearing me out! Thanks again.

[speechchick]

shipo that’s awful about that car situation. Don’t even think I have it in me to go look for another car and then trying to get approval and all. Praying mine will last. Thanks!

[speechchick]

flashoflight I hadn’t thought about receipts. I mean I guess it’s all in my bank statements since I use my debit card for everything. Sounds a little rough. Shall I plan on bologna and PB&J for a while? Just kidding. Or maybe not. We’ve already cut out anything extra for a long while, so maybe this won’t be too much of a shock. Thanks for the info!

[Carmella]

Carmella thanks so much for all the info. My car is a 2016 with lower miles so I’m hoping it will be ok. If I tried to trade it to get a newer car I’d just end up with one that’s not as reliable because I’m a little upside down. Husband’s is a 2019 with low miles so def not worried about his. I have so many repairs that need done(roof, new fence, etc) but no cash and can’t get any more loans. I really do worry about this. So are you saying if something like that came up you could get approval for a reduced or delayed payment or something? Or no? I know what you mean about the debt consolidation thing. Prob would not have helped. I’ve been doing debt settlement for 3 years and paid off a ton, but still a few have sued and I have judgements. I debated at the time and thought it would be better thank BK. Prob not. Found an attorney close by with like 289 4-5 star reviews and all he does is BK. Def giving him a call. Even as I’m writing this I’m still trying to find another way out. My secured loans are current, but we have a ton of personal loans, back taxes, and credit card debt. Things were bad, but we were making it and then COVID hit. My husband and I both work in healthcare in nursing homes and we got zero help. We both got pay cuts and I was dropped to part time. We were forbidden to go work at other buildings also, so we lost a lot of extra money we were making in addition to our full time jobs. Make too much money and no kids so we weren’t worthy of the stimulus checks even though hello we have bills too and a LOT of lost income. I’m already living with negative dollars every week, so really even a tight budget would be better than this I guess. This is so hard and it’s wearing me out! Thanks again.

Yes there are ways to petition if there is something critical you need to repair. I don't know how it works since I haven't had to do it. My only experience was the car that was totaled and we were fortunate to get a good pay off probably due to the inflated price of cars right now. The loan was paid off and we had $ for a down payment.

From your comments about I work I think we might be in the same or vary similar profession, but I do not want to state my exact job title publicly on the board. I too work in a nursing home, got a pay cut and couldn't pick up work at other buildings. But my main building was busy enough to keep me at my 40 hours I lost hours on my second "as needed" job. My husband is an essential worker, but not in health care. He kept working 40 hours and started to get some overtime, but it wasn't as much as I made on my second job. Maybe I am misunderstanding, but the stimulus checks were for everyone at least the initial ones not the ones that came out later paying per child. But I think that is just getting $ now versus getting a deduction on your income taxes, but I don't have minor children, only one adult child, so I don't know the details.

I am with you on the nursing home situation and the lack of work and no compensation and no compensation when employees got covid or were exposed and had to quarantine in the beginning. I ended up with very mild Covid and was allowed to borrow PTO putting my PTO into the negative. But at least I could pay the bills. My second job started using me again late last year so that is good, but when they had bouts of Covid I was called off a few times. I was so glad they kept me on the roster. I got a pay cut at that job as well.

Something else to think about since you may want to increase your work hours or work an additional job is that can effect your BK 13 payment. You would have to see how much of payback you will have to make. Ours is 100% pay back the upside to that is if we make more $ we can keep it. If your payback is less than 100% there is a chance if you make more money they can require you to turn it over to the trustee to pay your creditors. I think the general rule of thumb is if you have 10% increase in pay they might want more $ (if you are not paying back 100%)

Your BK payment is based on your income from a time period before you file, I don't remember how long back. Since I was working two jobs our payment was based on my income at that time even though that job was as needed which means I could work 16 hours a week or zero, but it didn't matter they had to use it as my income.

See the attorney and see what your options are and go from there. BK 13 is no picnic, but it can help the creditors stop calling and you can move on with your life. The first few months were the toughest as we adjusted. This is month 48 of 60 for us so we have gotten use to the situation.

One thing I can honestly say is that the stress after BK, almost immediately after it was official was so much less/different than the stress prior to BK with the debt collectors, etc and just the stress deciding to go that route. I procrastinated and got reamed out by the woman who owns the law practice, she didn't even directly handle the case another lawyer did, but man did she ream me out and I deserved it. We also had lawsuits for not paying credit cards. BK has a stigma. I am glad we chose BK even though it was probably the most stressful point of my life.

I have kept quiet about BK and don't discuss it with anyone. I say we had a lot of debt/need to pay off especially since my husband retires in a few years and will have our debt paid off in 5 yrs and are on a tight budget. People get so nosey and sometimes you have to tell them something.

I just noticed you and I are in the same state.

BTW there were several weeks I took PB sandwich (I don't like J) to lunch at work because it was more affordable, that was at the beginning of BK. We usually had decent dinners, but I cut expenses on my lunch!

[Carmella]

I know I already said a lot, but something I found out is there's a lot of people who have gone through BK and do not talk about. Just know you are not alone and you are not a failure. BK does help us get back on track.

[speechchick]

Carmella Yes, it sounds like we may be in the same profession and it’s a small community. Crazy. Thank you for sharing what you’ve been through. It sounds really similar. I spoke with an attorney who was perfect and then found out he would have to drive 2 hours to court for us, so that was a no. He did run all the numbers and we’d have more to live on than we do now. Honestly, we’ve been doing a budget since the debt settlement and cut everything out a long time ago with no credit cards, so I’m hoping it won’t be too awful. I’m kicking myself for doing the debt settlement. Should have done BK then! Was trying to avoid it due to the stigma. Question for you…does your payment have to be deducted through payroll in Ohio or is there a way to pay to an account?

[Carmella]

I believe it is an automatic deduction in Ohio it wasn't presented to me as an option. I make more money than my husband so they deduct it all from my paycheck. I was worried about people finding out, but since our payroll is done through corporate not through the building I work in there was no chance of chatter/gossip going around. My plan has a step in it so when a car was paid off our payment increased. At that time I realized our corporate offices had relocated to a new building so the attorney had me email the info to corporate payroll to make sure they were informed of the change in the payment. I didn't even think about informing the attorney corporate had moved, I actually didn't even know they moved until a few months later when I heard coworkers complaining about the expensive new corporate headquarters! It's all been very discrete and no one I work with is aware of my BK 13.

There is a way to pay online to the trustee and I did that for the first month before the deduction kicked in. As we always say this is a good question for the attorney.

I hope you can find another attorney soon. I think you were saying that this one lived too far away. It's great he gave you the estimated payment information so at least you have an idea of what lies ahead. We are not allowed to mention any attorney's on this board, but if you are in the Akron/Cleveland area I'd be fine sharing info thru private message. And I don't get any kickback from the attorney so there's nothing in it for me to share the info. A friend recommended the attorney she had gone through BK 7 after a divorce before I knew her. I talked to her after we went to the shady attorney who wanted to do debt consolidation, we got such bad vibes from him I felt like we had NO options. She recommended the attorney we went to and she was the only person I told about our BK aside from anyone I had to deal with like the bank or the car dealership. She passed away about 2 yrs ago

I did a google search my attorney's office does not pop up at the top of the list, but that shady guy was FIRST on the list! Maybe he is helpful to some people, but we didn't get any good vibes at all from him.