Lost my job a few years back. Got behind on my mortgage & my already high interest car payment. Filed Ch. 13 in 2011 after starting another job that wasn’t paying a lot. Now I’m working making better money but I don’t have a lot of money left after paying my bankruptcy payment.
Can I file a Ch.7 bankruptcy and just give the house and car back while in a Ch.13? I filed a Ch.13 to save my house and car for my children’s comfortability. I feel that keeping the house and car is not worth it and I’m still drowning trying to provide food on the table. I feel that I can let it all go rent a house similar to mine in the exact neighborhood and purchase a cheap vehicle for a year or two. Is that the wrong way to approach it?
I don’t think it’s the wrong approach at all. In fact I think you’ve come to realize the life toil trying to hang onto stuff you can’t afford actually costs.
The desire to try and keep your grip on the home and car is robbing you of a less stressful life.
If you liked your bankruptcy attorney, you should talk to them about a strategy to do this.
Probably what they will suggest is to withdraw from the chapter 13 bankruptcy, default on the mortgage and car payments, either voluntarily had the car back or wait for it to be repossessed, and once they foreclose, file a chapter 7 bankruptcy to wrap up all the debt.
Update February 1, 2013
You actually would only need to convert the case and any resulting deficiency, I am told, would be terminated by the discharge.
The importance of having a plan to do this is to make sure that any liabilities from the home and car are included and discharged in your bankruptcy.
And don’t worry about rebuilding your credit after all of this. It’s really quite easy to do. See How to Easily Rebuild Your Credit and Have Good Credit Again.
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