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Filed for Chapter 13 Bankruptcy Two Years Ago and Can’t Afford the Payments. – Dani

“Dear Steve,

Filled for chapter 13 2 years ago. Cant afford payments

My fiancé filled for bankruptcy 2 years ago because him and his exwife maxed out the mortgage on his decreased
parents house that was at one time paid off. The courts ruled that she didn’t have to pay a dime towards something She helped destroy.

Since he filled for chapter 13 to save his house that he lived in for 40 yrs, the circumstances have changed. He now has to pay child support on top of the bankruptcy payments. He just had surgery on his hand that put him on light duty, plus three overtime he was offered is gone. I currently lost my job and have a baby on the easy.we can barely afford to keep the power on in the house let alone the gas to drive back and forth to his job.
He doesn’t want to loose the house but we just can’t afford to live like this. His last to paychecks we’re voided. Can this be legal to put someone so far down that it’s tyring to repay solly what was not all his debt to begin with. While she lives the high life in a new town house new truck and a masters degree with a huge paycheck. Not to fair if you ask me.can you offer any help.

Dani”

Dear Dani,

There are really three major options here:

  1. Contact the bankruptcy attorney and inquire about modifying the chapter 13 bankruptcy payment.
  2. Convert the chapter 13 bankruptcy into a chapter 7 bankruptcy. While this might lead to the loss of the house, unless you sell it, it appears that your circumstances have changed since filing the chapter 13 bankruptcy.
  3. Do nothing and let the chapter 13 be discharged for non-payment. Creditors will come back after you again.

While this might feel like an impossible situation you do actually have a couple of good options on moving forward, albeit on the path you envisioned.

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The most likely scenario here is that you talk to your bankruptcy attorney and discuss converting to a chapter 7 bankruptcy and how to handle the house.

From what you describe your lives have changed and your current circumstances do not allow for enough income to meet your obligations. Either the level of income needs to increase or the obligations need to decrease.

Talk to your bankruptcy attorney, come up with a plan, and let’s move forward quickly to wrap this up before the new baby is born so I can get you headed on a path up instead of this downward spiral. The current path is not helpful not healthy for you and the baby.

Please post your responses and follow-up messages to me on this in the comments section below.

Sincerly,
Steve

You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.




About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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