So, we filed chp 13 about 7 months ago. We have been paying at 100% (which has left us barely to cover expenses, and with less than 200.00 a month to save for emergencies). Due to back and forth with the trustee its not been confirmed (trustee wanted higher payments, lawyer fought because only half of the creditors filed on time, etc etc), but we have been paying it. We have about 10k in the trustees account.
Now, my DH got laid off from his job 
And sadly at his level, there are very few positions. While qualified and known, its going to take a while to find the right job for him. Likely, we will be either A) Taking upto 6 months to find a job here (small market where family and friends are) or B) Move to larger market in 3 months to find a job.
So... I spoke to our atty. I said "I want to transfer our case to a chp 7 right away because I know the backlog the courts are experiencing." And he told me it is better to wait untll the trustee files a motion to dismiss for nonpayment, AND THEN file to restructure to 7. Here is my thing; My DH made a very good wage, and we are likely to take anywhere between a 25-50k salary reduction (because the job market in the area we live is small- he got lucky and he knows it). SO no matter what, we will be paying less than 100%. My thing is why wait?
1) We have *no* savings and only 2 weeks severance pay
2) We will get by with expenses for 9 months if we pull from the 401k (which is dangerous in of itself because 401ks are protected by 7. If we pull it now, it may be siezed in chp 7
So, why wait..? If I can get the court date set sooner the better (and live off the graces of my loving family for 3 months while we ride the 7 out, and keep my 401k intact) and then get a discharge and then begin rebuilding..
Otherwise, my fear is that if I wait I am forced to pull out the 401 money to live, and either A) No job and we have to file chp 7 we will have to give up what is left or B) By waiting we have 6 months of time where he could find a job, start working and be in worse shape then before (because paying at say, 10% on an already reduced wage would be a struggle) or get fired right away from new said job when the court comes to asses his chpt 13 payments from his checks.
I also have like, 10k in the plan that has yet to be paid out to creditors. I am curious if they will dole it out to the creditors or if they would reimburse me if I filed 7
Dont say "no one gets fired for filing bankruptcy". because it does!
Sorry for sounding rant-y. Im frightened.
@ang123 wrote:
So, we filed chp 13 about 7 months ago. We have been paying at 100% (which has left us barely to cover expenses, and with less than 200.00 a month to save for emergencies). Due to back and forth with the trustee its not been confirmed (trustee wanted higher payments, lawyer fought because only half of the creditors filed on time, etc etc), but we have been paying it. We have about 10k in the trustees account.
Now, my DH got laid off from his job
So... I spoke to our atty. I said "I want to transfer our case to a chp 7 right away because I know the backlog the courts are experiencing." And he told me it is better to wait untll the trustee files a motion to dismiss for nonpayment, AND THEN file to restructure to 7. Here is my thing; My DH made a very good wage, and we are likely to take anywhere between a 25-50k salary reduction (because the job market in the area we live is small- he got lucky and he knows it). SO no matter what, we will be paying less than 100%. My thing is why wait?
1) We have *no* savings and only 2 weeks severance pay
2) We will get by with expenses for 9 months if we pull from the 401k (which is dangerous in of itself because 401ks are protected by 7. If we pull it now, it may be siezed in chp 7
So, why wait..? If I can get the court date set sooner the better (and live off the graces of my loving family for 3 months while we ride the 7 out, and keep my 401k intact) and then get a discharge and then begin rebuilding..
Otherwise, my fear is that if I wait I am forced to pull out the 401 money to live, and either A) No job and we have to file chp 7 we will have to give up what is left or B) By waiting we have 6 months of time where he could find a job, start working and be in worse shape then before (because paying at say, 10% on an already reduced wage would be a struggle) or get fired right away from new said job when the court comes to asses his chpt 13 payments from his checks.
I also have like, 10k in the plan that has yet to be paid out to creditors. I am curious if they will dole it out to the creditors or if they would reimburse me if I filed 7
Dont say "no one gets fired for filing bankruptcy". because it does!
Sorry for sounding rant-y. Im frightened.
Find out who gets that 10K sitting there if you file to dismiss, I think its returned to you but not sure... I would hold off on filing the 7 until regular income is re-established as you might have to add in more things that cant be covered due to unemployment.
I would trust your attorney, unless you really feel he's not right for you. After all, who has more experience in bankruptcies, you or him?
Starting Score 12/2013: 547 EQ; 529 EX; 540 TU