Chapter 13 Bankruptcy

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Chapter 13 Bankruptcy

Chapter 13 Bankruptcy questions and answers

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Q: How do you keep your home when filing medical bankruptcy? Chapter 7 or 13?
We are in the process of closing on our first house and don't want to mess this up. My husband is being forced to file bankruptcy soon on ONLY medical bills. I don't know if the bankruptcy should be filed just after closing to prevent a lawsuit from one of the creditors or if we should just go to court and settle the bankruptcy after a judgment has been passed. If we filed chapter 13 bankruptcy, what kind of percentage of the total bills do you usually have to pay on medical bills; or does it depend on your income and expenses? Help please! Also, will our credit cards (which we do NOT have a problem with) be taken away from us?

A: Why on earth are you buying a house when you are so far in debt? Keep in mind the additional costs of home ownership add on an additional 30%. It seems like you would just be making things even worse.

Q: If you file Chapter 13 Bankruptcy Can they take your income tax refund?
I have filed chapter 13 bankruptcy and I have not filed my income taxes yet. I have been told that the bankruptcy court can take your refund if you have one due to you. Is that true?

A: Yes they can....the trustee will make you sigh the check over to them....I file my taxes before I filed bankruptcy and I had to show an itemize list on how I spent the money...but I did not have to show receipts...and I couldnt pay bills ahead...I had to put stuff like car repairs, clothes, etc...if you file bankruptcy b4 u file your return....the trustee will take it...

Q: Chapter 13 Bankruptcy - How are the repayment figures calculated?
I am thinking of filing for Chapter 13 bankruptcy. I already have one judgment against me and I am worried another collection agency will be taking further action. How do they calculate the amount that the Trustee will accept for repayment? I am already paying close to $1000 for my unsecured debtors. I am concerned because I am going to have some large medical bills in the near future. Any help would be appreciated. Thanks.

A: Caveat: This is an oversimplified answer - Secured debt on your house is based on a repayment plan of 3 to 5 years applied to the amount delinquent at 0% interest. (You can repay any delinquencies over 3 to 5 years at 0% interest on top of your regular mortgage obligations.) Secured debt on cars, boats, planes, etc., may be bifurcated into the secured and unsecured portion. Secured portion remains. Unsecured can be discharged (rare event). Unsecured debt is usually paid back at the rate of approximately 75% of the amount owed. So, if you can afford this type of payment schedule, then Ch 13 is utilized. Otherwise, Ch 7 is on the table and the formula for that is different. In the meantime, convert all "non-exempt" assets to "exempt" assets.

Q: In chapter 13 bankruptcy will the trustee take my Tax return?
I just recently file Chapter 13 Bankruptcy in Oct 2007, wondering if I have to surrender my tax return to the trustee? Any light on the matter would be helpful? I filed in tennessee but live in Georgia

A: They won't take your "tax return" but if you have a refund coming that is normally part of the bankruptcy estate and will usually be taken to be applied towards your debts.

Q: How do you convert a Chapter 13 bankruptcy to a 7 in Oklahoma?
How do you convert a Chapter 13 bankruptcy to a 7 in Oklahoma if you dont qualify or make too much to do a 7? I may have to do a 13 soon but Im concerned with what I read about people not being able to make their payments to the trustee.

A: I don't know about Oklahoma, but here in the Southern District of California we just file a one page form signed by the debtor, and the case is automatically converted and reassigned to a Ch. 7 trustee. There will be other things to file, for sure, like updated Means Test and Schedules I & J. A new creditor's meeting is scheduled. Check with a local attorney, or start by checking the local bankruptcy court's website. Some of them are really helpful.

Q: I went through a chapter 13 bankruptcy last year. How do I get re-financing for some properties?
I have consitently paid on my chapter 13 to the courts for about 1-year now. However, I am still behind on some properties I own and need to refinance everything I ahve. Any ideas? No the bankruptcy ahs not been discharged. ASny private investors out there who will take a chance on a guy who wants to turn it around and wants to start over?

A: If you have made payments on time to the trustee for the past 12 months, and the mortgages are included in the BK, you might be a candidate. Its up to your trustee on the time frame. FHA will allow CH. 13 Buyouts if there is enough equity in the property and you can prove your income. They are not credit score driven. If your mortgages are outside of the BK and you are behind, you are looking at a Hard Money Loan. They are mainly Equity Driven. For more info visit www.530lending.com

Q: Can you walkway from your Chapter 13 Bankruptcy payments without losing the two vehicles that i have?
I filed chapter 13 bankruptcy 3 years ago. i am not able to make the payments on my bankruptcy, but i dont want to lose my two cars. I have about 24 payments left, but i am not able to obtain certain necessities for my kids because all of my money goes to bankruptcy. I want to walk away from it like everyone is walking away from their homes. I heard that you could walk away, but i always thought you had to pay every month, so they dont take your vehicles away from you.

A: If you can maintain your current auto payments on the cars and have an agreed written agreement on how to handle your present autopayment arrearages you can either walk away relatively unscathed by your Chapter 13 experience or allow it to be converted to a Ch-7 liquidation so long as you have a written agreement to reaffirm your auto loan agreements. The answer is in your total debts and income. If you are paying off a large amount of unsecured (credit card) debt, this makes some sense...On the other hand if your debt is primarily secured debt and taxes you are only temporarily treading water. Obtain good financial counseling from a source with access to your situation. Good Luck

Q: How Much is Credit Card Repayment Principle Reduced Under Chapter 13 Bankruptcy Filing?
I am considering filing Chapter 13 Bankruptcy and know that I will have to pay back the creditors under the repayment plan between 3 and 5 years. I am trying to figure out how much I will be paying per month to the trustee. I live in Florida, have $41000 in unsecured credit card debt, $24000 in a car loan and pay $1800 a month in child support. I make about $78000 a year gross.

A: Sorry....it's not going to be a straightforward answer. To start, you need to take a look at Form B22c from the bankruptcy court. http://www.uscourts.gov/rules/BK_Forms_08_Official/B_022C_0108v2.pdf This is sort of a "worksheet" that will eventually calculate what your "disposable income" will be. Your disposable income is the amount of money left over after taking your income and deducting your living expenses. The remaining will them be paid to the trustee. Getting all of the info to fill this form out is going to be very time consuming, but it's the only way you will be able to figure it out. You can also examine the other forms and instructions if you really want to give it a shot... http://www.uscourts.gov/bkforms/bankruptcy_forms.html#official The previous answer about only paying 10% is ridiculous. I have seen people get away without paying a dime, while others have had to pay nearly 75% of their debt. The new BK laws were designed so that if you make a decent amount of money, they are going to force you to pay a higher amount back. As you fill out these forms....remember that a lot of attorneys got out of doing bankruptcy work because these forms are a bit difficult and there are a million ways to make a mistake. So don't even try to think you can do your own bankruptcy, ok?

Q: Is it possible to get a new home load while in Chapter 13 Bankruptcy?
I have been in Chapter 13 Bankruptcy for 2 years and it will be discharged in 1 more year. Is it possible to get a $25,000 - $30,000 home loan? If so how and with which lenders? Actually the court can approve that you can get a loan. The only reason it was filed is bc we had an enormous amount of medical bills. That was it.

A: Are you kidding? Trying to borrow more money while in CH. 13 could get your case thrown out.

Q: Can I receive a settlement while in a Chapter 13 bankruptcy?
I am currently in a Chapter 13 bankruptcy, but might get awarded a settlement. Will I be able to receive this settlement or will it go to the bankruptcy trustee?

A: Call your attorney. If this is an exempt asset or one obtained completely after filing of your case (ie injured after case filing) you should be able to keep it. If this is not an exempt asset, and one that was not listed on your original petition, you may need to ammend. For example, if you are in a 10% plan because you had no assets. Yet this is a $100k injury settlement that should have lead to you being in a 100% plan. Lucy got some 'esplainin' to do.

Q: Can I buy myself out of a joined Chapter 13 bankruptcy?
My husband and I are in a chapter 13 Bankruptcy. We are going through a divorce now. Can I buy out of the Chapter 13 and file a Chapter 7 by myself?

A: no. you can buy urself out if you do it through a company, start one (a paper - only cash company) and than walk ur way out of it!

Q: How long before I can purchase a home after a Chapter 13 Bankruptcy?
If I was to file for Chapter 13 Bankruptcy, how long would it take for me to be able to purchase a home with FHA. How long will it take before creditors approve me for credit. Thank you,

A: FHA does not look at credit. They only look at your ability to repay based on your debt/income ratio.

Q: Am I able to claim medical bills that were filed in a Chapter 13 bankruptcy on my taxes?
I'm uninsured and was rushed to the hospital and the total bills were over $14,000.00. I ended up having to file Chapter 13 bankruptcy since I don't make enough to pay them back. I need to know if I can file it on my taxes since I'm paying them back but not all of it.

A: You can only claim medical expenses that you PAID in 2007, and only those expenses that exceeded 7.5% of your income for the year.

Q: Can I get a Mortgage Loan after filing for Chapter 13 Bankruptcy?
I do not own a home, and am thinking about filing for Chapter 13 Bankruptcy. The question I have is, after I am clear and my debts paid, is it impossible to get a loan to buy a home?

A: It bothers me to see people filing for any bankruptcy. Your credit can be corrected if you just do several things to straighten your lifestyle. Begin by cutting out ALL your WANTS and some of the things you THINK you NEED. If you have three cell phones cut back to one or two. Yes you can get by on one. If you are paying too much for TV service cut back. Start on an austere food and life style program. Start eating a lot of beans and rice. Discontinue eating fast food. Begin cooking at home. NO MORE STEAKS, roasts and those expensive cuts reach for your favorite cook book and look up soups and stews. Look around your house to see what you can get rid of. Have a garage sale. Go on the inet and look up Dave Ramsey and find a Counselor in your area. If I lived in your area I could help. God Bless. Be proud of yourself do not depend on others to bail you out. YOU CAN DO IT you just need to learn how..

Q: What happens when Chapter 13 bankruptcy disposable income isn't really disposable?
Additional Details When I took the Means Test for Chapter 13 bankruptcy for Astoria, NY, it showed my disposable income as being much higher than it actually is. This is because they didn't deduct my 401k contributions or my student loan payments. If I file for Chapter 13, will I be expected to stop contributing to my retirement fund and stop making student loan payments for five years in order to repay my debts?

A: Good question to ask your attorney. But typically: A. 401k contributions, unless mandatory, are considered disposable income. B. Repayment of 401k loans is also considered disposable income, ask your atty about the possibility of a two step plan. C. Repayment of your student loan may be built into your payment plan.