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Diving into Chapter 13! Follow me through it!!

New Member

Diving into Chapter 13! Follow me through it!!

Well, here goes. After drowning in debt for  years, I have had enough. Our story begins like this is: My wife and I married young, and had no good money sense. Im not ashamed to admit it. The bad thing is, we had great jobs - which means tons of credit card offers. We truly were addicted for years - racked up well over $100,000. And on top of that we were both in college - so between us we racked up $146,00 on SL debt. About 3 years ago, we went cold turkey on the cards. I mean stopped. Since then we have paid of well over $30,000 of what we owed, and were well on our way to getting out of this mess - but then boom! - major loss of income. Since April of 2012 we have been trying to get by on $1500 a month less, and when you were breaking even each month, there is no quick way to fix it. When you are $1500 short each month, and have already tightened the budget all you can - you are in a mess. Sadly I thought I could "float" my way through - paying things late here and there, and staying a float on payday loans. BIG MISTAKE. Please avoid these like cancer - they are a never a good idea I don't care how bad you need the money. Believe me I know. Finally in early December we realized we could no longer go on like this and live. So after looking at all our options, chapter 13 was most logical. We meet a decent attorney, have filled out all the paperwork, and are waiting to file on the day they benefits us the most looking at out upcoming budget. Honestly I have read the internet from one end to the other looking at the good, the bad, and the ugly. I am expecting the worst. Im sure the Trustee will 'tweak" something, as it seems they always do. But although 5 years seems like a long time, I can tell you I am honestly relieved and at peace with my finances for the first time in many,many years. I full well know it will be hard...at times VERY HARD, but at the end of the day, we should be able to live via our budget and save a little for emergencies. We are paying back all @ 63% as well. Even though this seems like a 5 year prison to many, the reality for us is - we are not underwater, treading water, and robbing Peter to pay Paul. This board has helped me, so I will post often to keep everyone abreast of our journey. Here goes!

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Valued Contributor

Re: Diving into Chapter 13! Follow me through it!!

Good luck on the Chapter 13 and the rebuilding phase. I filed a 7 in 2003 and turned around and filed 13 in 2005. So I know the good, bad, and ugly you speak about.

I was on a 5 yr plan with the 13 and successfully paid the plan off and shortly after it was discharged in 2011. It was deleted after 7 yrs in Oct 2012. You did the right thing by filing a 13 vs a 7. Just make all of your payments, and it will be deleted in 7 yrs vs 10 yrs with a 7. I was able to get a nice used car the Trustee approved in 2008. Got an Orchard Bank card in 2009 and gardened those trade lines until July 2012 when I was approved for a Capital one Cash Rewards card. I pay in full every month on both cards. Then in Nov/Dec, the BK fog finally lifted and I was approved for tier 1 lease financing on a brand new Acura in Nov. And just this month, I was approved for a Chase Freedom and yesterday I got my loan commitment letter and conditional approval for a brand new house just built in November 2012 and we close at the end of the month! In September when the BK 7 finally is deleted after 10 years, I will app for a Discover and AMEX and will be all set credit wise.

My husband and I were just like you two. Financially naive and careless. But we are back on our feet and you will be too in a few years. I had to live on cash only for 8 years after I screwed up the credit cards I got in college. Living on cash only taught me to live within my means and that was when I actually started using a savings account! When I was young and dumb, all I had in it was $25 to keep it open.

Learning the hard way is a priceless experience and you and your wife will be credit gurus when you come out from under the 13!
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Smiley Happy Last App: 4/5/13 Gardening until July 2014
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