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Complicated bankruptcy chapter 13

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Dad1972

Junior Member
What is the name of your state (only U.S. law)? KY

My wife and I are filing Chapter 13 bankruptcy. We have already retained our lawyer and began paying him. We met with him for a couple of hours last week but we still have a few things we are unclear about and sort of having doubts if we understood him correctly or if he is clear on the situation.

First of all, my wife could file Chapter 7, but I can't because I filed Chapter 7 only a couple of years ago. Our attorney said that not enough time has passed for me to get my debts discharged and I would have to sign acknowledging that, but that when enough time passes I can drop this 13 and do another one with the debts being discharged. And that my wife's could be "flipped to a Chapter 7." This has us very confused.

Also, this is the same attorney who handled a property settlement for my wife a few years ago. She was awarded half of her exhusband's 401K and IRA, but there were so many other issues, the atty. never pursued that. Now she is worried about those funds, but the atty. assures her that retirements cannot be touched in the bankruptcy and he apologized for putting it off so long and said he will get that money for her right away. From my online research on this and other sites, it looks to me like the money is safe as long as it remains in a retirement account, but if and when the attorney gets her half out for her, that she would then lose it to the trustee. But our atty. insists it will be safe and that she can use it to pay him for the rest of the bankruptcy, to pay our accountant an outstanding debt we have with him and the state taxes from 2006 she owes. (We have no idea how much money she is getting, by the way.)

Another question we have is the mortgage...which is the main reason we are filing, to save our home. We have 3 mortgages. Based on our 2007 appraisal our home is worth 99,000, but I understand that a current appraisal would probably be lower because of the market. Our total owed for all three mortgages is less than that appraisal (50K + 15K + 13K) so it would appear we have equity in it. I understand we have exemptions, but my question is can we really have the second and third mortgages "stripped?" (By the way, we tried to sell for about a year, but there are just no buyers)

Just to give you a broad picture. My net income is $2500/month. My wife gets $600 in child support. I pay $700 in child support. Our mortgages are $1050/month. Our car payment is $350. Our insurance is $300. We have no credit cards except for one I pay in lieu of alimony that was my exwife's with $1200 outstanding (I've paid two bigger ones off.) We have about $5,000 in unpaid medical bills. My wife owes $8,000 on her student loan (we know that one doesn't go away, but the atty. said she might get a hardship forgiveness since she can no longer work due to illness.) And another $400/month to finance companies. My wife owes $1500 to KY state taxes. We owe $1200 to our acct. (but the atty. said we would pay the accountant outside of the repayment plan because his is an ongoing relationship/bill we have with him) We had no problem paying these bills until last year when my wife became ill and lost her job. (She has too few work credits to qualify for SSD because she worked as a school teacher and did not pay into SS for 5 of the past 10 years.)

I probably have other questions, but I am just a little overwhelmed by all of this. Thank you for your help.
 
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Proserpina

Senior Member
What is the name of your state (only U.S. law)? KY

My wife and I are filing Chapter 13 bankruptcy. We have already retained our lawyer and began paying him. We met with him for a couple of hours last week but we still have a few things we are unclear about and sort of having doubts if we understood him correctly or if he is clear on the situation.

First of all, my wife could file Chapter 7, but I can't because I filed Chapter 7 only a couple of years ago. Our attorney said that not enough time has passed for me to get my debts discharged and I would have to sign acknowledging that, but that when enough time passes I can drop this 13 and do another one with the debts being discharged. And that my wife's could be "flipped to a Chapter 7." This has us very confused.

Also, this is the same attorney who handled a property settlement for my wife a few years ago. She was awarded half of her exhusband's 401K and IRA, but there were so many other issues, the atty. never pursued that. Now she is worried about those funds, but the atty. assures her that retirements cannot be touched in the bankruptcy and he apologized for putting it off so long and said he will get that money for her right away. From my online research on this and other sites, it looks to me like the money is safe as long as it remains in a retirement account, but if and when the attorney gets her half out for her, that she would then lose it to the trustee. But our atty. insists it will be safe and that she can use it to pay him for the rest of the bankruptcy, to pay our accountant an outstanding debt we have with him and the state taxes from 2006 she owes. (We have no idea how much money she is getting, by the way.)

Another question we have is the mortgage...which is the main reason we are filing, to save our home. We have 3 mortgages. Based on our 2007 appraisal our home is worth 99,000, but I understand that a current appraisal would probably be lower because of the market. Our total owed for all three mortgages is less than that appraisal (50K + 15K + 13K) so it would appear we have equity in it. I understand we have exemptions, but my question is can we really have the second and third mortgages "stripped?" (By the way, we tried to sell for about a year, but there are just no buyers)

Just to give you a broad picture. My net income is $2500/month. My wife gets $600 in child support. I pay $700 in child support. Our mortgages are $1050/month. Our car payment is $350. Our insurance is $300. We have no credit cards except for one I pay in lieu of alimony that was my exwife's with $1200 outstanding (I've paid two bigger ones off.) We have about $5,000 in unpaid medical bills. My wife owes $8,000 on her student loan (we know that one doesn't go away, but the atty. said she might get a hardship forgiveness since she can no longer work due to illness.) And another $400/month to finance companies. My wife owes $1500 to KY state taxes. We owe $1200 to our acct. (but the atty. said we would pay the accountant outside of the repayment plan because his is an ongoing relationship/bill we have with him) We had no problem paying these bills until last year when my wife became ill and lost her job. (She has too few work credits to qualify for SSD because she worked as a school teacher and did not pay into SS for 5 of the past 10 years.)

I probably have other questions, but I am just a little overwhelmed by all of this. Thank you for your help.
Your wife may qualify for SSI if she's still unable to work because of health issues.

More to the point though if you're not comfortable with the attorney, you really want to find another. Though you may get some wonderful responses here, they'll be quite general in nature - because your situation seems to be somewhat complicated you really need legal advice that's actually tailored to your specific situation.
 

Dad1972

Junior Member
Don't even think I added everything...

We have more issues that I forgot...so I agree it is vastly complicated. We like our attorney and except for putting off the property settlement, we've always been pleased with his work. He did my Chapter 7 and I thought it would be beneficial that he knows our vast issues. So I hate to trade him...

This is just so important. I hate to go through with this and then get a surprise later. We don't even know how much money my wife will get from the retirement funds and we certainly want to pay it toward our overwhelming debts, but I didn't know if we would get to pay the debts that we have to pay outside of BK (attorney fees, Student loan, taxes, child support, accountant...) or if the trustee would get to decide who gets what.
 

Proserpina

Senior Member
We have more issues that I forgot...so I agree it is vastly complicated. We like our attorney and except for putting off the property settlement, we've always been pleased with his work. He did my Chapter 7 and I thought it would be beneficial that he knows our vast issues. So I hate to trade him...

This is just so important. I hate to go through with this and then get a surprise later. We don't even know how much money my wife will get from the retirement funds and we certainly want to pay it toward our overwhelming debts, but I didn't know if we would get to pay the debts that we have to pay outside of BK (attorney fees, Student loan, taxes, child support, accountant...) or if the trustee would get to decide who gets what.
OK, there's a bk forum here Bankruptcy Forum : debt discharge, foreclosures, creditors (I know one or two of the more experienced posters here have mentioned it - I don't think I'm crossing any line in mentioning it). Summarize your situation and try posting there; there are one or two attorneys (that I do know of) but moreover, many posters who are or have been in a similar situation.

Again, it's not that I think this board is incapable of helping you - it's just that there are perhaps quite a few intricate factors that take you from "normal Ch 7 or Ch 13" and dump you quite firmly in the "This might be tricky and it may be beyond the scope of this forum" category.

You're absolutely right in seeking legal help - though successful pro se filings do happen it can be something of a gamble if your case is anything but a very simple Ch 7.
 

Dad1972

Junior Member
One quick question...

before this thread gets bumped off...where do the threads on this forum go? I've noticed they get clipped after a day or two whereas the threads in other areas (I'm also on child visitation in the family/divorce category) stay much longer.

And thanks for your help.
 

Proserpina

Senior Member
before this thread gets bumped off...where do the threads on this forum go? I've noticed they get clipped after a day or two whereas the threads in other areas (I'm also on child visitation in the family/divorce category) stay much longer.

And thanks for your help.
(you're welcome!)

Ah - what happens is your initial "front page" of a forum will list only very recent posts. If there are no recent posts you may not see any posts at all. You can go down to the page and change it so you can see all of the posts and not just the recent posts.

Cripes. I know what I'm trying to say, but I'm uncaffeinated and apparently not expressing myself too well ;)
 

Dad1972

Junior Member
Luckily...

I have had enough caffeine for the both of us and so you make perfect sense to me :) but I haven't tried to find that option yet. I'll see if I can figure it out.

I can't get the other forum link that you gave me to work, though...hmmm? What am I doing wrong?

Never mind...I copied and pasted the descriptor with the url. Got it...thanks.
 
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Dad1972

Junior Member
Urgent repo question

We filed Chapter 13 two weeks ago. I knew there was a danger of having our only vehicle repossessed since we'd gotten behind on the payments. So as soon as we filed (put that pymt. in at 100% repayment over 5 years) I called the bank and they said it was out for repo, but that they'd put a hold on the repo until they could confirm it. I gave them the case # and my attorney's name and number. They called and confirmed the BK filing with the atty's secretary.

Now 15 days later a repo man came to our house to get the vehicle. Luckily, I knew the man and he told me that the police are looking for the vehicle as well. I gave him the case number, he told me that confidentially the bank "is dirty" and are trying to take the vehicle anyway. I am trying unsuccessfully to find a home number for my atty. (he lives out of town) and I really don't know what to do. The repo man said the order is from 2 months ago. So apparently the bank did not put a hold on the repo. I don't understand. My atty. said even if there was a lapse in communication between the bank and the repo people, and they took the vehicle, they would have to give it back. The repo man said if they find it, I won't get it back.

Please help. It is our only vehicle. Our credit is of course, horrible. We can't get another one. I just want to pay for it and keep it. What can I do?
 

Dad1972

Junior Member
Thank you so much haplesshome

I have literally been online all day googling "Chapter 13 repo" and have read until my eyes are falling out. I think the repo guy is so new to repo that he gave me a lot of incorrect information, but he was nice to me. He even called me back to give me the name and number of the main person at the repo company that the bank needed to inform of the bankruptcy filing.

I received the paperwork and court date from the trustee over a week ago so I will do exactly that--tape it to the window. We are in an economically depressed area (even moreso than most in the US), jobs are scarce, and I know these repo people want to get paid for getting my vehicle. So I'm sure they will take it if they can. Unfortunately, we don't have a garage and the vehicle is an extra large one that won't fit in the family member's garage we tried to get it into. I'm thinking about sleeping in the cab tonight. :confused:
 

Dad1972

Junior Member
I will do that...

I know for a fact that the bank called the atty's office because I called them while still there and his secretary ran out to the parking lot and told us that they called her to confirm that we had filed. I gave the repo man the case number and showed him the top copy of the filing too so I know they know as well.

My wife tried to log into the bank's website to see if they had tried to contact her recently (we always paid them online and checked our acct. details there) and her account has been disabled. She couldn't even log on.

We thought about calling them again, but feel like we shouldn't have to keep calling them...especially 2 weeks after we filed and notified them personally.
I used to have my attorney's cell phone number and now regret not keeping that handy.
 

Dad1972

Junior Member
not much sleep

"Slept" on the couch, blinds open. Sure enough the same repo guy did a drive-by last night around 11:30 p.m. (we live on a dead end road) The truck wasn't in the drive way. He went past, turned, and left.
 

germai

Junior Member
before this thread gets bumped off...where do the threads on this forum go? I've noticed they get clipped after a day or two whereas the threads in other areas (I'm also on child visitation in the family/divorce category) stay much longer.

And thanks for your help.
I think this is just a setting. Once you get in the forum change the view from today to all, this should help!
 

Dad1972

Junior Member
Automatic stay question

I wasn't sure whether to start a new thread or add to this old one...so here goes. All is well with the Chapter 13. After falling behind on ALL our bills when my wife became ill and lost her job and our business went under (I work full time) we can FINALLY actually pay our bills.

The problem is now my ex-wife who has decided to take me to court for contempt for being late (in the past) I'm not now...on marital debt. I have paid off 2 of her credit cards and only have one remaining. I have paid it down to a 700 balance. I'm paying it outside of the repayment plan. Also, she tried to claim that our decree stated that I had to refinance our mortgage (I was awarded the home) but in court our attorney and the judge both stated that the decree does NOT say that and that even though I have attempted to refinance 3 times and was turned down by 3 different banks, there is nothing I can do with regard to that.

My issue is this...when I told the judge I would not/could not be late on the mortgage any more since I'm in Chapter 13, the judge cautioned my exwife that I was under Bankruptcy protection and that she could be in trouble in Federal Court. Her attorney seemed shocked and said he didn't know anything about the 13. My exwife admitted in court that she was notified as a creditor. The judge asked her if she wanted to continue with contempt charges or just wait and see if I stayed current. She actually said to set a date for contempt hearing.

I have googled family court/BK issues and have read mixed results...sometimes I read that family court is exempt from the automatic stay, but I've also read that those are only SUPPORT issues. I am current on CS, it comes straight from my check. She was awarded no alimony or maintenance...I received all the marital debt in lieu of maintenance. Am I protected by the automatic stay in this situation? What would you do if you were my attorney?

My attorney is going to send something...not sure what, not sure if it's just a warning letter or actually to file a complaint with the trustee.

Thank you.
 
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GaAtty

Member
GaAtty

Surely your attorney knows what to do. This kind of situation arises often in bankruptcy. Neither your wife nor anyone else can bring a debt collection action against you while you are in bankruptcy. If she does, you need to notify your attorney. You should make sure that your attorney also knows that you are making payments on your wife's credit cards outside of your chapter 13 plan. Since you have your own attorney, you should consult your attorney on all of these matters. If you don't feel that you can consult with your attorney then you need to find a different one.
 

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