topic Re: Credit Reporting after Chapter 13 in Bankruptcy

Credit Reporting after Chapter 13

matt14 — Mon, 30 Mar 2020 15:06:54 GMT

Hello everyone,

Hopefully someone has had this experience and could provide some insight. I have a couple of questions regarding how debts are reported after a Chapter 13 plan is complete and accounts falling off after filing.

A little background, i filed Chapter 13 in November 2019. All of my accounts are now updated on my credit report showing 0 balances with the note 'wage earner plan'. My home(2nd mortgage only) and car are both set to get paid out in the plan. I have a 1st and 2nd mortgage of which I pay the 1st mortgage outside of the plan and the 2nd (which was a balloon) is set to be paid off under the plan.

My questions:

1. Will my 1st mortgage balance/payments ever show on my credit since i am technically still paying them outside of the plan?

2. I also have 2 student loans that are showing 0 balances but are not included in my plan. Will these start to report again (with the balance) once i have completed my 5 year payment plan?

3. Is it normal for accounts(credit cards) to be removed from a credit proile after the Ch 13 filing? (I had several Synchrony accounts to be removed from all 3 of my credit reports) and will they ever come back?

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 30 Mar 2020 15:44:16 GMT

@matt14- Good Morning,

Great questions you're asking. I filed Chapter 13 on March 17th. I have so many questions and these forums are mainly consumed with those who have filed a chapter 7. Appreciate you posting as I'd like to know the answers myself. How are your scores looking? I'm still receiving hits on my scores daily. I can't wait for everything to finally settle so I can see where I'm actually at. Best of luck to you. Keep us updated please.

Be safe

Re: Credit Reporting after Chapter 13

matt14 — Mon, 30 Mar 2020 16:22:51 GMT

@justme79 my scores are back in the 700's on Transunion and Equifax. Experian is still in the high 500's. I think the updates to my credit file have settled down now. I initially took the big hit and went into the 400's but once all of the accounts updated with the 0 balances my scores are steady now. Hopefully somone has experience around the questions i asked previously. Best of luck to you as well.

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 30 Mar 2020 16:41:03 GMT

@Matt14- I just finished my Chapter 13 plan a few months ago. Waiting on my discharge papers which should be at the end of April per Pacer.

I only have 1 mortgage on my house. Once the CRA were reporting that I was in a Ch13 payment plan, my mortgage lender stopped reporting my mortgage payments (I didn't include that with my Ch13 filing so I was paying that outside my plan.) Same goes for my car loan, it isn't reporting anything, infact it looks like I dont even have a car loan or mortgage at the moment. I spoke with my Attorney about this and he said once I'm done with my plan and am discharged, the lenders for my mortgage/car will then begin reporting to the CRA's.

I also have studen loans. Those show a 0 balance at the moment, but they will show up with the balance once I'm discharged (per my Attorney.)

As for the removal of credit card accounts after filing? Not sure what you're asking. Were these scheduled to be off and were not included in BK? I haven't had any credit cards account removed. All the accounts that I included in my filing are still there and is noted "included in bankruptcy" or something similar to that.

Re: Credit Reporting after Chapter 13

matt14 — Mon, 30 Mar 2020 17:06:30 GMT

@miam thanks for the reply. Please keep this post updated. I would love to know about the reporting phase when it starts again. The credit card accounts that were removed from my credit profile were not scheduled to be removed and they were included in my filing. I had a total of 10 accounts that were removed. All the accounts were in good standing when i actually filed (just couldn't keep up the payments).

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 30 Mar 2020 18:02:20 GMT

hmmm...I'm not sure why yours got removed when you filed and mine didn't. LOL. I want them removed!! And like you, all my accounts were in good standing too when I filed. I just knew I wouldn't be able to keep up with the payments.

I'll be back to post updates later in April to see how my credit report looks like afterwards and how long it took for my mortgage/car to start reporting again.

Good Luck!

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 30 Mar 2020 18:03:39 GMT

Some of my accounts have been removed as well...

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 30 Mar 2020 18:29:43 GMT

I just looked at my EQ. Unfortunately, all the accounts IIB are still there. But they're scheduled to come off in 2023 so I guess that's ok.

Re: Credit Reporting after Chapter 13

matt14 — Mon, 30 Mar 2020 18:40:03 GMT

@miam well i won't continue to look a gift horse in the mouth LOL. I will accept the accounts are gone and appreciate the blessing :-). I had tons of cards so for those to be removed was a GOOD thing. And yes, please share your post dc journey with the credit reporting. I wish my student loans would NEVER report again lol.

Re: Credit Reporting after Chapter 13

matt14 — Mon, 30 Mar 2020 18:41:33 GMT

@justme79 were any of them with synchrony?

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 30 Mar 2020 19:24:07 GMT

@Matt14 - Yes, and I'm happy they are GONE! (Amazon, Paypal Credit, and Paypal Mastercard) Unfortunetly my lawyer advised me to stop paying months prior to filing and he included everything on my credit report, including the paid off and closed accounts. I went from the 700's to the 400's. I'm trying my best to stay positive. Hopefully the trustee will allow me to get a secured card to start my rebuild. I have a student loan as well but from reading the comments, thats not going to appear again until after discharge. So happy you're still in the 700's, that's a HUGE blessing.

Re: Credit Reporting after Chapter 13

matt14 — Tue, 21 Apr 2020 22:54:32 GMT

@Anonymous have you had any updates on your mortgage or student loans reporting again? I read in a couple of other post the mortgage paid outside of the plan may not ever update or report, even after the discharge. I hope that is not the case since i had perfect payment history on my mortgage.

I finally had my confirmation hearing 4/14, so now i have to just continue to make my payments and ride out these next 4 years. I was lucky one of my oldest cards (15yrs) with my credit union (which i did not burn) survived so that has helped my score stabilize.

Look forward to the update :-).

Re: Credit Reporting after Chapter 13

Anonymous — Tue, 21 Apr 2020 23:14:49 GMT

@matt14 There's no updates yet. My car payment and mortgage was paid outside my plan and they stopped reporting a long time ago. Yesterday was the 33rd day that creditors had to object to my filing before the courts discharge my case. With COVID going on, I dont know how long it will take for my trustee/the court to discharge my case. Once it discharges and if any updates on the reporting of mortgage/car payment/school loans, I'll be sure to post back up here. (Hopefully I'll remember. )

And that's great that you were able to keep one of your cards. That'll help you out tremendously! The four years will fly by quickly!

Re: Credit Reporting after Chapter 13

sarge12 — Tue, 21 Apr 2020 23:43:29 GMT

@matt14 wrote:
Hello everyone,

Hopefully someone has had this experience and could provide some insight. I have a couple of questions regarding how debts are reported after a Chapter 13 plan is complete and accounts falling off after filing.

A little background, i filed Chapter 13 in November 2019. All of my accounts are now updated on my credit report showing 0 balances with the note 'wage earner plan'. My home(2nd mortgage only) and car are both set to get paid out in the plan. I have a 1st and 2nd mortgage of which I pay the 1st mortgage outside of the plan and the 2nd (which was a balloon) is set to be paid off under the plan.

My questions:
1. Will my 1st mortgage balance/payments ever show on my credit since i am technically still paying them outside of the plan?
2. I also have 2 student loans that are showing 0 balances but are not included in my plan. Will these start to report again (with the balance) once i have completed my 5 year payment plan?
3. Is it normal for accounts(credit cards) to be removed from a credit proile after the Ch 13 filing? (I had several Synchrony accounts to be removed from all 3 of my credit reports) and will they ever come back?

To answer question #1, it depends on whether you have reaffirmed the debt, or are just keeping the payments up to date. All legal responsibility for debts cease when BK is filed and debt is discharged. That is at least the case with chapter 7. Some lenders require a reaffirmation, which is like a new debt, but in either case BK does not cancel any liens. Non-reaffirmed debt that is continuing to be paid will not show new payments good or bad, as the debt itself is no longer enforcable, but the valid lein can be executed in foreclosure. As for question 3, the credit card issuers are required by law to indicate that the debt was included in bankruptcy, if they report it at all. Some might find it easier to just not continue to report it. With the bankruptcy on the report there is little if any effect from debts before the bankruptcy anyway. Everything I just said is true for chapter 7 in most States, but I am not really sure it all holds true for chapter 13. You can usually keep your house and car with either chapter provided the equity in the house does not exceed the legal exemptions for chapter 7. Neither chapter will discharge student loan debt, but I do not know how it is handled on credit reports. I know that sometimes a chapter 13 is filed solely because the equity in a house exceeds the chapter 7 exemptions, which would require the debtor to sell the property to pay the creditors. Sometimes the debtor may have too much income to qualify as well, because chapter 7 requires a means test, where chapter 13 does not. If the lender of debt secured with a house or car does not require a re-affirmation agreement, it is nearly always better not to sign one, especially on a car. You will not receive the title to either until the lein is satisfied, but if not reaffirmed, but still retained, and later the engine blows up, you can let it go without a repo showing on your credit report. If discharged in bankruptcy, and not reaffirmed, the vehicle can be reposessed due to the lein, or surrendered by the debtor with no affect on your credit report at all. That is because the debt itself was discharged so the debtor is not legally liable for the debt. The lein is still enforcible though, but it is rare in most States for the lender to repossess the car if not delinquint. If reaffirmed there is a new debt on the car, and that debt and any defecit that it incurs will be enforcable by law, just like any other post bankruptcy debts. At the very least, be sure the property is worth more than is owed on it before reaffirming the debt. Otherwise you could 2 weeks later total the car, and you will be legally liable for the deficit when the insurance fails to cover the lein.

Re: Credit Reporting after Chapter 13

matt14 — Wed, 22 Apr 2020 00:31:25 GMT

@sarge12 Thanks for the reply. I did reaffirm my mortgage and car. I wish i had read through these forums before doing so but i knew at the time i needed to keep my house and car. Lucky for me my car is fairly new, so hope it does not blow up on me anytime soon :-). That was good info so i will see what happens with the reporting once i am discharged.

Re: Credit Reporting after Chapter 13

sarge12 — Wed, 22 Apr 2020 00:48:44 GMT

@matt14 wrote:
@sarge12 Thanks for the reply. I did reaffirm my mortgage and car. I wish i had read through these forums before doing so but i knew at the time i needed to keep my house and car. Lucky for me my car is fairly new, so hope it does not blow up on me anytime soon :-). That was good info so i will see what happens with the reporting once i am discharged.

Well people often keep their car by just continuing to make payments without reaffirming. It is a risk though, because they can repossess even if payments are not ever late. They rarely do though, because they almost always lose money by repossesing it. The reaffirmation is more beneficial for the lender than the debtor. It will prevent repossesion if paid ontime, but in reality, I have never known them to repossess a car if the payments are being made, even though they technically could. Most lawyers advise against signing a reaffirmation if possible.

Re: Credit Reporting after Chapter 13

matt14 — Mon, 03 Aug 2020 12:24:31 GMT

@Anonymous Did your mortgage and student loan ever start to report?

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 03 Aug 2020 15:23:58 GMT

@matt14 My mortgage never reported but my school loans did. The school loans are being reported as active and current. I emailed my mortgage lender and they said since it was included in BK which it wasn't, they can't report it to the CRA's. which in my opinion sucks because it won't show that I have other accounts besides credit cards and school loans.

Re: Credit Reporting after Chapter 13

matt14 — Mon, 03 Aug 2020 15:39:05 GMT

@Anonymous thanks for responding. Yes that does suck on the mortgage. I was hoping that wouldn't be the answer. Mine is with BOA so not sure it will ever report again either. Fingers crossed, i still have 4 more years to find out :-). Thanks again for the update.

Re: Credit Reporting after Chapter 13

Anonymous — Mon, 03 Aug 2020 15:53:03 GMT

@Anonymous - Wow, that really sucks. Maybe down the road if you refinance it will report again... doesn't make since for it not to report!