Can anybody give me some information about chapter 13 bankruptcy?

Question

I'm very behind in all my bills and have lots of debt (excluding credit card debt) and am considering filing chapter 13. I have already been to the .gov website and read up on a lot of information about filing and everything.

What I was wanting help with is I'd like to hear from people who have already filed chapter 13 bankruptcy and are currently in their 3-5 year repayment plan or people who have come out of it already.

I can read information all day long but theres nothing like hearing from people who have already been through it. Was it worth it? Pros? Cons? Any advice? Thoughts?

Anything would help and be greatly appreciated.

Answer 1

I would go with a Chapter 7 if you have that option.  It would be better and easier for you.

Answer 2

I don't know why anyone would file a 13 if they could qualify for a 7... please look into it.

I mainly work with people whose Chapter 13 has failed, so I don't hear a lot of good things about it.

The failure rate is EXORBITANT... before they changed the laws a few years ago, the failure rate was 70-80%, depending on whose numbers you want to believe. Those numbers may be even higher now, but the industry has a vested interest in keeping these figures quiet.

The tendency is to take everything you've got but the lint in your pockets. If you should have a hardship during the course of your plan, you run the risk of having the plan dismissed.

Any time you receive unexpected income, you'll need to contact your attorney to find out what to do with it.

Most tax refunds- they go to the trustee, as well.

The worst thing of all is that you really don't learn any effective money-management skills because all of your money is managed FOR you... by the trustee.

What a lot of people find is that if their case is dismissed, they're even FURTHER behind than when they started, but good luck trying to find out where all the money went that you'd paid while on the plan.

The main problem is that people don't learn the truth about the system until they've been run over by it.

My best suggestion is to see if you can handle these issues some other way... and NOT with a debt consolidation company.

Chapter 13 should be your LAST resort.