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Please be very careful if considering a chap 13 BK. It is nothing like a chap 7. Chap 7 is a liquidation program and 13 is a restructured debt program - very different. If you qualify for a ch 7 that is the only way to go because you walk away free from your debt, but with ch 13 you are FORCED to repay as much of your debt as possible. Most ch13 plans FAIL - up to 80%!! Think about that. If the plan fails (you quit making payments to the trustee) you lose court protection from creditors, plus you have the BK on your credit report. You are really screwed!
Why do most fail? It's a debtors prison. The trustee controls everything abour your finances and srutinizes all income and expenses. You are expected to pay everything you can to your creditors and then live on the little that's left over. It's 3-5 years of financial hell and most people give up. Only makes sense if you are trying to save a house; otherwise, don't do it. You can negotiate on your own - I've done it with great success.
Nobody chooses to do a 13. It all has to do with your disposable income plain and simple.
You have a choice between filing and not filing. My advice: don't do it.
your right life is filled with choices though sometimes Chapter 13 is the best option but I do agree with you sometimes it isn't, each situation is unique and the individual(s) need to make the decision on which option is best for them, I'm 1 year in a chapter 13 and I actually have breathing room again, this was the better option for me (trust me I looked at negotiating, had a lawyer look at negotiating before I filed)
Yes, each situation is unique, and I was speaking in generalities. Good luck to you.
You have your opinion and people still have to do what's best for them. I'm 2 years in my 13 and it's allowed me to flourish again. I see that light at the end of the tunnel. If you owe back taxes, chapter 7 won't get you out of that situation. That and city parking tickets were the main reason I had to file chapter 13.
Parking tickets and Chap 13!!?? Is that a joke? Ok...I'm sure you had some hefty fines and an arrest warrant you were running from, but come on. Did you put a chain around a parking meter, yank it out of the concrete and haul it to your backyard?
Yes, someone people do ok with a chap 13, but again, statisitcally most consumers never complete the program. That was something my lawyer told me - and he had money to lose.
@coreyb80 wrote:You have your opinion and people still have to do what's best for them. I'm 2 years in my 13 and it's allowed me to flourish again. I see that light at the end of the tunnel. If you owe back taxes, chapter 7 won't get you out of that situation. That and city parking tickets were the main reason I had to file chapter 13.
You can discharge (wipe out) debts for federal income taxes in Chapter 7 bankruptcy only if all of the following conditions are true:
Chapter 13 was the best thing I ever did. I didnt have them taking everything each month. I was still able to have a great apt and even save. Sure I took a side gig part time on weekends, but I loved that running store so it wasnt like 'work'.
I even got raises, signing bonus, and income tax refunds and my trustee never blinked an eye. I paid off early too. I dont understand how 80% ppl fail in 13 (I know they do)...but how? Do those ppl just start to over extend again...? I never opted for ANYTHING until I was discharged for a used car about a year before discharge; now 3 years later I have a lot of money (for me) saved, and a brand new house. I was able to live quite confortably while paying back what I owed.
I'd recommend it to anyone that truly had no other options. It can change peoples lives. It did for me.