13 to 7

[Anonymous]

I've been lurking on here for a few weeks and WOW, some of these post BK stories sound amazing! Hoping for the similar results. I'm currently in Ch. 13, but will be converting to 7 to just be done with the BK. Filed in Nov. 14'. So far I've gotten a Fingerhut account with a CL 850 and 19% utilization. Two new student loans, lend up "LOC". I've been at 100% payments while on Ch.13. Well I've been monitoring my CS on Credit Karma but we all know those scores don't count! Just wondering if I should pull my CR to see my actual scores. Hoping on purchasing a new vehicle after the discharged 7 in about a month. I have 2 medical collections that were never included in my BK so I've negotiated to pay them so they can come off and boost my scores. Hoping to get into NFCU after the discharge and start with their secured card and *fingers crossed* CO secure or unsecured cards. Any advice on how to go about my plans is much appreciated!

[Anonymous]

Where to begin...I suppose with "Welcome to the forums!"

If I read your post correctly, you've been in Ch13 since Nov 2014...are the accounts you talk about ones that were included in the 13, or new credit you opened with the 13 in progress?  In the first case, expect them to be discharged along with everything else in the 7...in the second expect your entire case to be dismissed unless you had the permission of your trustee to open those accounts.

Assuming you do make it to discharge, NFCU is a great idea, but they recently tightened up a bit - no unsecured approvals until 1yr post discharge

You might try Capital One, assuming they're not included in your BK

Good Luck!

[Anonymous]

I'll give you my two cents. I've been in a 13 for 4 years come March. I was very frustrated at one point, as people filed 7's and were able to rebuild and move on with their lives... While I was stuck in credit purgatory for 5 years repaying debt. Something isn't right about that.

I gave serious thought of converting a year or so ago. The upside is that you get to begin rebuilding quicker and you can end the monthly payments. The downside is that a chapter 13 falls off of your report at 7 years... 10 for a 7. After analyzing things, it made more sense for me to wait until the 4 year mark and pay it off early. Oftentimes, once you hit the 36 month mark, you can pay off early. It may be worth at least checking with your attorney to see if an early payoff is feasible.

The other thing that helped me was I was able to get a few cards if they were under a certain amount. I picked up Fingerhut and the Open Sky secured card. My scores now sit all above 650. Once I get the discharge, I don't think it will be long before I'm pressing 700.

All in all, make sure you consider both sides of this equation before you make a move.

[Shooting-For-800]

13 is better than 7.

13 file date is when your BK started.

So if you are 4 years in, your BK is 4 years old.  After discharge, it is like the BK was filed 5 years eariler regardless of the fact you just finished.

It is possible to shoot straight to 700 within months of 13 discharge.

[Anonymous]

I don't necessary after or disagree with the above poster's comments. IMHO, you can't disregard the 3 to 5 years you spend in purgatory in a 13. Oftentimes, chapter 7 filers are at a different, better place two years post discharge (see 700 in 24 months thread) than you're at 4 years into a 13.

IMHO, if you can do both, the only upside to a 13 over a 7 is that it can be removed after 7 years as opposed to 10. I think it absolutely sucks that, in most jurisdictions, you can't do a thing to rebuild your credit during those 5 years. You're almost penalized for paying back at least a portion of your debts. Conversely, a chapter filer gets a clean skate in just a few months.

Rebuilding from a 13 is relatively painless. By the time you discharge 5 years later, lots of the baddies won't even be on your report. You'll just need to establish some new credit. As I said, there are positives and negatives each way. When I wanted to convert, it was mainly to be done with it. I hope this helps.

[Anonymous]

I do agree, though, that if you're three years into the 13, it'd probably be better to find a way to pay it off early rather than converting.

[Shooting-For-800]

Think about it this way...

If you do a 13 and survive 5 years, 2 years later the BK completely falls off your CR.

Now if you do a 13 and last 3 or 4 years, then file Ch7, you have 10 more years for a total of 13-14 of BK on your CR.

If you can survive a 13, finish it.  

[Anonymous]

I agree. It only makes sense to convert early on. This far into it, finish off. He'll, you can even buy a home while you're still in the 13. If you convert to a 7,youll have a mandatory wait imposed on you for FHA... Even longer for conventional.