My husband and I are in the middle of a Chapter 13 bankruptcy that has been a disaster from the very beginning. We were told we could only file 13 because of an appraisal on our house, a piece of property we were left from an inheritance along with several other family members (that we don’t want but are unable to sell,) and because we were beginning to become behind on our mortgage payments.
Our lawyer proposed a 3 year plan with payments I was already skeptical we would be able to handle as we approached our meeting with our trustee. The trustee turned our 3 year plan to 6 years, increased our repayment amount, and stipulated he would take half our income tax returns every year.
We agreed because we did not no what other options we had at that point even though I new we were going to be in for a hard hard road ahead. Basically I feel we are in worse shape now than before the bankruptcy with creditors threatening us. We can barely afford our utilities and food bills and we do not qualify for an assistance because all the agencies do not look at our income after bankruptcy has been deducted – only net income.
I have tried every agency I could find. We lost our second car to repo. We have not been able to pay the trustee their portion of our taxes because we need the money to live and eat. I have eliminated every kind of “fluff” and then some — we never go anywhere, we cant even afford gas!
I have three children who I feel are suffering because we can barely afford the basics let alone any extracurricular activities for them. We have been able to qualify for a few credit cards after filing with very small credit limits — have maxed them and been unable to make payments and now have creditors calling us again.
My husbands job is such that he is frequently laid off for a week or two a month and the trustee still takes payments out of his reduced checks leaving us with virtually nothing those weeks. The trustee also takes payments out of any bonuses he gets throughout the year making it virtually impossible to get ahead – our lawyer has no solutions for us.
I have a close relative who agreed to try to help us pay off our bankruptcy but our lawyer advised against it stating the trustee would only significantly increase the repayment amount.
I have thought about selling our home and buying a much lower priced home to lower our house payment which is automatically taking out of my husbands paychecks as per the trustee, and pray that we could get enough equity out of the house to possibly discharge – but our lawyer again thought that the trustee would just increase our repayment amount and warned us of the rigorous process in which selling a home in the middle of a Chapter 13 would intale.
And then what would we do to be able to get a new home loan? We are alone here, a job transfer from Michigan to Ohio and no family to take us in. Our lawyer did warn us that our county trustee is very difficult to work with and very harsh – he was certainly correct in this matter.
I cried throughout our initial trustee meeting like an idiot and this man didn’t seem fazed one bit. I feel trapped and helpless. My question is . . . what can we do now? I would NEVER ever advise bankruptcy for anyone after what we have been through.
We looked into credit consolidation services before filing bankruptcy and were quoted what we thought were high monthly repayments amounts, but looking back now we would have struggled for a much shorter amount of time, been done now and obviously credit score would have been dinged but not smashed.
This is a total nightmare! No fresh start here! There has got to be something I can do to fix this – we are not going to make it another 3 years like this!
Since we have filed we have been with out electricity at times, without water at times – with out phone at times – without cable – if it were not for local foodbanks who do not ask income questions we would have not had food – we have been without heat because our house uses very expensive prop ane – we have gone without without without – - sorry for the sounds of desperation – just really hoping someone can offer some words of encouragement!
Would it not have made more sense to sell the house and land, pay down your debt, and then file a chapter 7 bankruptcy to discharge the rest of your debt in about 90 days?
I’m not sure the limitations or instructions you gave your attorney when you started this process but if you told your attorney you would absolutely not sell the house or property then the attorneys hands are tied as to what to do.
But the trustee has their hands tied a bit as well. If you don’t want to lose the house to foreclosure, even in a chapter 13 you will need to make the regular mortgage payment plus some to get caught up.
I can’t see how this self imposed journey of punishment is helping things in any way. If you don’t like your bankruptcy attorney, talk to another one. Find one you “connect” with.
You can click here to find a local bankruptcy attorney and talk to them for free about your specific situation.
But just from what you’ve shared it seems that terminating your chapter 13 bankruptcy now, selling the property and then refiling a chapter 7 would make your lives much more manageable? Heck, the trustee might even be willing to sell the property in a chapter 7.
It seems you might have been asset rich but cash poor to support those assets, even in a chapter 13 bankruptcy.
Let’s find the right solution for you that lets you move forward with your life and start over. I think you’ll just have to let go to get ahead to do better.
Please post your responses and follow-up messages to me on this in the comments section below.Our Chapter 13 Bankruptcy Has Been a Nightmare. - Holly by Steve Rhode