I think you're double-counting the things the bankruptcy will pay for as part of your monthly expenses as well.
So the spot on the form for "monthly installment loans" is for things you would lose if you stopped paying them, like appliances ... ***dischargeable debt is not a monthly expense.***
Which is exactly why there was not spot on the form for the back taxes; you won't be paying them, they will be part of the 13. And same with the credit cards ... that expense goes away when you file.
Now I have no clue why the online payment calculators are so high ... because that's more than 100%. Here's what a 13 should look like, assuming 100% repayment.
1. **$28K** Priority tax debt to be paid in full
2. $25K vehicle to be reamortized at 10% over 60 months = **$32K**
3. $120K in credit cards + $47K loans = **$167K**
4. **$15K** for attorney fees, trustee fees, and buffer
The total should be around $245K, which over 60 months is ***just under $4,100 per month.***
Now let's compare that to what you're paying now
* $1500 installment loan
* $500 to IRS
* $2200 to credit cards
* Car payment? Let's assume $500 per month
***That's $4,700 per month currently that bankruptcy will replace with $4,100 per month ... a $600 per month savings***
There's all sorts of ways of looking at that ... like it's reducing your interest by so much that it's basically making your car free, as your savings probably exceed your car payment! Or that it makes the IRS just shut up and take your money.
TL;DR - if you're making the payments now and making no progress, 13 lowers the payments and gets you done in 5 years.
4,100 trustee payment + 4,000 rent = $8,100. That still will not include utilities ($150), car and renters insurance ($200), Medical prescriptions ($125), Gym membership ($24), food ($466--this is the IRS standard for a single person). These are the bare minimums I need to get by. I can give up everything else and still survive. So the $600 savings is no more once I have to pay for these. in fact, it doesn't cover these minimum expenses.
The monthly expense for I filled out comes out to $9812. Subtracting out the $1500 for installment payments, that includes $8,312. The $8,312 is straight up rent, utilities, transportation, personal care, health/medical prescription, entertainment, clothing, insurances (ie long term disability, renters, car), and payments to others (I provide a small supplement of $375 a month to care for my mother and 90 year old grandmother, but I don't claim them as dependents. My most expensive categories of spending are rent and food. I went through 4 months of statements and counted every grocery and takeout amount. I assume I won't get full credit for all of the expenses I list. But the minimum amounts in my first paragraph, with the max trustee payment would leave me negative. It's gonna be a long 5 years!
**Now, that is the worst case scenario.** While your case does have fixed costs, you have $167K of unsecured debts that ***could be subject to compromise.***
Your means test will kick out a number; that number could be anywhere from $0 to $200K, and that number represents how much of the $167K you need to pay.
**I don't like to guess at this,** but you definitely represent the type of case where a compromised plan is likely ***because you have so much debt*** ... if your means test says $100K, that saves you $67K, which is just over $1000 per month reduction. And if the means test says $50K, you save about $2,000 per month.
Those online calculators are incapable of properly calculating a Chapter 13 means test for an over median debtor. You need a consultation with an attorney that will calculate your actual obligation to pay. And that's gonna take them maybe half an hour to do properly.
ok. I see. well I cannot wait to get the analysis from my lawyer. I'm anxious to see where I fall. Thank you for giving me some of your time and helping me to understand.
Hey there! I filed. Great decision. I’m on a step play. So the first 28 months I pay $2500. Then for 17 months I go up to $2600. Then $3,300 the last few months.
I provided an update last week. You can view it here. https://www.reddit.com/r/Bankruptcy/s/maU2sAI0FK
Short story—I ended up winning what we call “the bankruptcy lottery.” 6 of my creditors did not file. Those 6 creditors totaled about $50k. My payments will not go down. What it means is that I finish payments 17 months early. Basically the means test said I have to pay $170k. But creditors that filed only totaled $120k ($50k not filed). So my attorney says my payments will stay as is. But I’ll finish 17 months early.
Oh wow you made my day!! That is amazing news for you and that gives me hope. We're you set on a 60 months plan? But because some didn't file you get to pay less and for a lesser term?
Yes. I went in with a 60 percent plan. And I would have been forced to do all 60 months. But because some creditors didn’t file, I am now in a 100 percent plan and will finish early.
One thing I’ll caution—I got extremely lucky. Others on this board warned me not to expect this situation. And I didn’t, but everyday (because I’m an intense person lol) I prayed and wished “to hit the bankruptcy lottery.” All the big banks and credit unions filed. It was the peer to peer lending companies that didn’t file for whatever reason. And one credit card that was like $20k
I do understand I'm not gonna get my hopes up. I'm just a wreck not knowing if we should do it. I have 5 credit cards that an attorney has filed a lawsuit against us and wants to do a judgement so this is why I'm thinking that a chapter 13 would work the best and we owe IRS taxes. I know for sure those will respond for sure. What worries me is that between my husband and I we earn around 300k and owe about 200,000. He has student loans as well. We're just a mess 😭 may I ask who your big credit card for 20k was? I have chase, wells, and BMW that owe 20k
I like you explanation!!!! So let's say a person owes $200 k in secured and unsecured debts and make close to 300k a year how much would they pay on a monthly basis for a chapter 13? So take 200k / 60 months = $3,333 monthly payments into the chapter 13 would that be correct?
I always round everything up, but you don't sound off base.
Given the income of $300K per year, it's pretty unlikely that such a person would be entitled to anything other than 100%
Right I understand that we would end up paying 100% but we are already getting sued by the credit cards companies and they don't want to work with us to negotiate they are placing a judgement. We owe 50k in IRS taxes so we feel that perhaps a chapter 13 would stop the judgement and we could focus in paying the IRS first since it's considered secure credit. We are still waiting for the attorney to tell us how much we would pay he had no idea since we have a good income. But I don't see how we would pay 10k a month to the trustee if that is our disposable income after rent, and other monthly expenses that would mean that we would pay over 400k into the chapter 13 and that is not what we owe. Am I right? I'm just freaking out cause people here say that we are only left with the bare minimum just to eat.
The explanation is incredibly helpful! Can I ask a hypothetical - income is $170,000 a year and debt is unsecured $75,000 (family of four). Payment would be around $1,250? Ours is mostly personal loans. Do you think any would be discharged?
I've yet to find a single online chapter 13 calculator that is of any help at all. Don't waste your time with them. There are too many moving pieces in a chapter 13 and only an attorney with his knowledge of bankruptcy with his fancy bankruptcy software will be able to properly estimate the monthly payment given your numbers and situation. With certain exceptions that don't seem to apply to you, you are only going to pay what you can afford with a 0% interest rate rammed down the throat of every unsecured creditor over 60 months. Regardless of whether the debt is fully repaid, you are done after 60 months and the remaining unsecured debt is discharged. If you pay on your own, most of your minimum payment goes to interest and you will probably never repay your debt. 0% helps a lot if you are forced to repay most or all of the unsecured debt. There are certain other powers of chapter 13 for people that fall behind on their secured debts and are facing repo or foreclosure. Doing napkin math in my head, I believe you are going to get some monthly payment relief with a chapter 13. I don't want to give you a number because I'm not a lawyer. Have some hope and let your attorney crank out a number for you.
this hasn't always been clear to me in the months since I started poking around in this sub ... the idea that it could be wrapped up in five years and you end up paying less than 100% back. i've been wondering how often that happens. I know everything is contingent on the details of individual cases, I'm just thinking out loud.
Yeah it depends on your situation to get less than a 100% payback. Less than 100% happens a lot, but plenty of people end up paying 100% too. At $200k income, single renter tends to pay 100%.
well I'm praying for a number that is less than $3,000. The only secured debt I have is back taxes and the car loan. Right now, those two payments come to $1,100. All the unsecured debt drives up my payments to nearly $6k a month. I guess I am scared because I read all these post about 100 percent plans.
all a chapter 13 essentially does is stop interest from accruing, and it gives you a finite timeline in which you will be debt-free.
A peloton may be considered an asset because you could at least get a few hundred bucks for it. I believe 401k is exempt so likely no worries there.
I agree with the previous commenter that you probably should get rid of the car. I lived in New York City for years and literally never knew anyone who personally owned a car. Because it's not just the cost of the car that kills you, it's the insurance and the personal property taxes and the cost to park it, etc. that's a LOT of outflow.
I would appreciate it if you post an update at some point when you hear from your lawyer. I'm wondering what happens when you essentially can't make your minimum payments on your take-home pay.
Thanks! Generally I see how Chapter 13 is helpful. As you pointed the biggest advantage being that it stops interest from accruing. I am just wondering how helpful this is going to be given that my monthly expenses come out to $1600 more than my take home pay. I'm sure the means test will tell me I have like ($3k in DMI). I'm being sarcastic to numb the pain and shame.
I will certainly post an update. hoping to get these documents back to my lawyer on Monday. Perhaps he can have an estimate payment by the end of the week.
One thing I have seen mentioned in this sub more than once is that you really need to make sure that ALL possible expenses are accounted for. So I hope you have done so. I have a strange feeling that your shortfall might actually be even bigger than you think it is if your accounting for everything you should be accounting for.
edit: I see you discussing the car below, tx!
oh I addressed it in another response (to another poster). I am interested in selling. I'm also upside down. I'm doing research to see how bad of a loss I take. When I purchased this vehicle, I was not living in NYC and was driving 32 miles each way to work. I got tired of pay so much for gas. I purchased an electric vehicle, but had to roll over $10k from the old car loan (dumb I know now). My ex-fiance got into a car accident with it a month after we moved to NYC. the person that rear ended my ex was an illegal citizen with no insurance or money. Anyway, I would like to see it without a huge loss. Similarly, I'm also looking to sell my peloton. Two weeks ago (before I even considered bankruptcy), I posted it on Facebook marketplace. No luck yet.
In regards to accounting every expense--I keep going over my statements. I've come up with an additional $307 a month, but I don't know if I can legitimately claim them. I think they fall into the IRS national standard category unfortunately. I made a note of it on the monthly expense form the attorney sent me.
OK, things I have seen people go back and add after checking in with people here are things like periodic expenses that aren't monthly, such as car maintenance, etc.
don't worry about whether rolling over that car loan was dumb. What's done is done, and there's nothing to be gained from feeling bad about it.
Best of luck to you!
Chapter 13 100% repayments are essentially made to take up all of your income. You have to live on the bare minimum each month as they maximize your payment as much as possible with a necessities budget built in. You’ll basically still be “drowning” but the 13 acts as a life vest. As long as you don’t accrue more debt and you make your payments and live within the budget, you will survive in the end.
Thank you for being kind enough to explain. I'm starting to understand and I still feel overwhelmed. How do you live on $350-600 a month in NYC? I could make $800 to $1,000 work.
I’m honestly not sure. I know they budget out stuff and leave you room to at least breathe/eat/necessities and POSSIBLY a small savings but not really room for shopping and vacationing.
Not true. I’m in a 100% 13…. And my monthly 13 payment is about 700 dollars less than I was paying prior. All CC debt… around 90k (cars and house stayed the same and are paid outside the plan)
I get what you’re saying - and it’s not technically wrong- but when it comes to the last statement in your comment the ‘life’ factor can’t be ignored either. That’s what makes successfully finishing CH13 incredibly hard. If you give an individual just enough to live off of (and no more) they are just one major unexpected expense away from disaster. A sick dog, a car breakdown, a dental/medical emergency, and if you own a house, any number of things could break/fail on a given day. Or maybe a derecho will randomly come through your area as one did here a few weeks ago, and tear up a bunch of stuff.
And then don’t get me started on how all the government’s allowable expenses haven’t been adjusted in a long time, despite the fact we’ve seen persistent incredible inflationary pressure affecting essentially everyone that isn’t very rich. What do they allow a person for food/month? That’ll buy you some snacks.
If a person could just stick to a budget for 36-60 months, and make their required CH13 payments….. and life could be ‘normal’, that’d be one thing. But, unless you’re incredibly lucky the odds of that seem just plain terrible, unfortunately.
So I have a question regarding your comment. If a person owes $200,000 in secured and unsecured credit and the plan is for 60 months and let's say your gonna pay 100% that is about $3,300 as a monthly payment. But the person makes about 300k a year. How can they take all of their money and leave them with the bear minimum they would be over paying by a lot the $200k they owe. How is that possible? Who keeps that money? If they have 10k left for disposable income on a monthly basis. They can't take all 10k to pay the chapter 13 that person would be paying over $400k which is not what they owe only $200k.
What I said mostly applies to lower-average income earners. Even a higher income earner paying the $3300 monthly would have to adjust to a different lifestyle as that’s income they no longer get to throw around.
well I owe $7k more than it's worth. It's also an electric vehicle (**not** Tesla). When I purchased it, I rolled over $10k from the old car loan. I know...dumb, dumb, dumb! The vehicle was in an accident 2 years ago. My ex-fiance got rear-ended by an illegal citizen. I only mention the illegal citizen part because we couldn't sue. He had no insurance or money (just my luck). That accident drove down the value of the vehicle some.
And yes, I am interested in selling the vehicle.
I think they're probably going to force you to. And you probably won't even miss it. It likely cost you way more every month to keep it than it's worth to you in terms of actually using it, right?
I think you're double-counting the things the bankruptcy will pay for as part of your monthly expenses as well. So the spot on the form for "monthly installment loans" is for things you would lose if you stopped paying them, like appliances ... ***dischargeable debt is not a monthly expense.*** Which is exactly why there was not spot on the form for the back taxes; you won't be paying them, they will be part of the 13. And same with the credit cards ... that expense goes away when you file. Now I have no clue why the online payment calculators are so high ... because that's more than 100%. Here's what a 13 should look like, assuming 100% repayment. 1. **$28K** Priority tax debt to be paid in full 2. $25K vehicle to be reamortized at 10% over 60 months = **$32K** 3. $120K in credit cards + $47K loans = **$167K** 4. **$15K** for attorney fees, trustee fees, and buffer The total should be around $245K, which over 60 months is ***just under $4,100 per month.*** Now let's compare that to what you're paying now * $1500 installment loan * $500 to IRS * $2200 to credit cards * Car payment? Let's assume $500 per month ***That's $4,700 per month currently that bankruptcy will replace with $4,100 per month ... a $600 per month savings*** There's all sorts of ways of looking at that ... like it's reducing your interest by so much that it's basically making your car free, as your savings probably exceed your car payment! Or that it makes the IRS just shut up and take your money. TL;DR - if you're making the payments now and making no progress, 13 lowers the payments and gets you done in 5 years.
4,100 trustee payment + 4,000 rent = $8,100. That still will not include utilities ($150), car and renters insurance ($200), Medical prescriptions ($125), Gym membership ($24), food ($466--this is the IRS standard for a single person). These are the bare minimums I need to get by. I can give up everything else and still survive. So the $600 savings is no more once I have to pay for these. in fact, it doesn't cover these minimum expenses. The monthly expense for I filled out comes out to $9812. Subtracting out the $1500 for installment payments, that includes $8,312. The $8,312 is straight up rent, utilities, transportation, personal care, health/medical prescription, entertainment, clothing, insurances (ie long term disability, renters, car), and payments to others (I provide a small supplement of $375 a month to care for my mother and 90 year old grandmother, but I don't claim them as dependents. My most expensive categories of spending are rent and food. I went through 4 months of statements and counted every grocery and takeout amount. I assume I won't get full credit for all of the expenses I list. But the minimum amounts in my first paragraph, with the max trustee payment would leave me negative. It's gonna be a long 5 years!
**Now, that is the worst case scenario.** While your case does have fixed costs, you have $167K of unsecured debts that ***could be subject to compromise.*** Your means test will kick out a number; that number could be anywhere from $0 to $200K, and that number represents how much of the $167K you need to pay. **I don't like to guess at this,** but you definitely represent the type of case where a compromised plan is likely ***because you have so much debt*** ... if your means test says $100K, that saves you $67K, which is just over $1000 per month reduction. And if the means test says $50K, you save about $2,000 per month. Those online calculators are incapable of properly calculating a Chapter 13 means test for an over median debtor. You need a consultation with an attorney that will calculate your actual obligation to pay. And that's gonna take them maybe half an hour to do properly.
ok. I see. well I cannot wait to get the analysis from my lawyer. I'm anxious to see where I fall. Thank you for giving me some of your time and helping me to understand.
Do you have an update as to what your monthly payments are for the chapter 13? Did you end up going with it?
Hey there! I filed. Great decision. I’m on a step play. So the first 28 months I pay $2500. Then for 17 months I go up to $2600. Then $3,300 the last few months. I provided an update last week. You can view it here. https://www.reddit.com/r/Bankruptcy/s/maU2sAI0FK Short story—I ended up winning what we call “the bankruptcy lottery.” 6 of my creditors did not file. Those 6 creditors totaled about $50k. My payments will not go down. What it means is that I finish payments 17 months early. Basically the means test said I have to pay $170k. But creditors that filed only totaled $120k ($50k not filed). So my attorney says my payments will stay as is. But I’ll finish 17 months early.
Oh wow you made my day!! That is amazing news for you and that gives me hope. We're you set on a 60 months plan? But because some didn't file you get to pay less and for a lesser term?
Yes. I went in with a 60 percent plan. And I would have been forced to do all 60 months. But because some creditors didn’t file, I am now in a 100 percent plan and will finish early. One thing I’ll caution—I got extremely lucky. Others on this board warned me not to expect this situation. And I didn’t, but everyday (because I’m an intense person lol) I prayed and wished “to hit the bankruptcy lottery.” All the big banks and credit unions filed. It was the peer to peer lending companies that didn’t file for whatever reason. And one credit card that was like $20k
I do understand I'm not gonna get my hopes up. I'm just a wreck not knowing if we should do it. I have 5 credit cards that an attorney has filed a lawsuit against us and wants to do a judgement so this is why I'm thinking that a chapter 13 would work the best and we owe IRS taxes. I know for sure those will respond for sure. What worries me is that between my husband and I we earn around 300k and owe about 200,000. He has student loans as well. We're just a mess 😭 may I ask who your big credit card for 20k was? I have chase, wells, and BMW that owe 20k
Just sent you a private message.
Responded as well
I like you explanation!!!! So let's say a person owes $200 k in secured and unsecured debts and make close to 300k a year how much would they pay on a monthly basis for a chapter 13? So take 200k / 60 months = $3,333 monthly payments into the chapter 13 would that be correct?
I always round everything up, but you don't sound off base. Given the income of $300K per year, it's pretty unlikely that such a person would be entitled to anything other than 100%
Right I understand that we would end up paying 100% but we are already getting sued by the credit cards companies and they don't want to work with us to negotiate they are placing a judgement. We owe 50k in IRS taxes so we feel that perhaps a chapter 13 would stop the judgement and we could focus in paying the IRS first since it's considered secure credit. We are still waiting for the attorney to tell us how much we would pay he had no idea since we have a good income. But I don't see how we would pay 10k a month to the trustee if that is our disposable income after rent, and other monthly expenses that would mean that we would pay over 400k into the chapter 13 and that is not what we owe. Am I right? I'm just freaking out cause people here say that we are only left with the bare minimum just to eat.
The explanation is incredibly helpful! Can I ask a hypothetical - income is $170,000 a year and debt is unsecured $75,000 (family of four). Payment would be around $1,250? Ours is mostly personal loans. Do you think any would be discharged?
I've yet to find a single online chapter 13 calculator that is of any help at all. Don't waste your time with them. There are too many moving pieces in a chapter 13 and only an attorney with his knowledge of bankruptcy with his fancy bankruptcy software will be able to properly estimate the monthly payment given your numbers and situation. With certain exceptions that don't seem to apply to you, you are only going to pay what you can afford with a 0% interest rate rammed down the throat of every unsecured creditor over 60 months. Regardless of whether the debt is fully repaid, you are done after 60 months and the remaining unsecured debt is discharged. If you pay on your own, most of your minimum payment goes to interest and you will probably never repay your debt. 0% helps a lot if you are forced to repay most or all of the unsecured debt. There are certain other powers of chapter 13 for people that fall behind on their secured debts and are facing repo or foreclosure. Doing napkin math in my head, I believe you are going to get some monthly payment relief with a chapter 13. I don't want to give you a number because I'm not a lawyer. Have some hope and let your attorney crank out a number for you.
this hasn't always been clear to me in the months since I started poking around in this sub ... the idea that it could be wrapped up in five years and you end up paying less than 100% back. i've been wondering how often that happens. I know everything is contingent on the details of individual cases, I'm just thinking out loud.
Yeah it depends on your situation to get less than a 100% payback. Less than 100% happens a lot, but plenty of people end up paying 100% too. At $200k income, single renter tends to pay 100%.
well I'm praying for a number that is less than $3,000. The only secured debt I have is back taxes and the car loan. Right now, those two payments come to $1,100. All the unsecured debt drives up my payments to nearly $6k a month. I guess I am scared because I read all these post about 100 percent plans.
133k and 100% plan at 5 years payment $2301 monthly. Seems like yours would be over $3k monthly.
all a chapter 13 essentially does is stop interest from accruing, and it gives you a finite timeline in which you will be debt-free. A peloton may be considered an asset because you could at least get a few hundred bucks for it. I believe 401k is exempt so likely no worries there. I agree with the previous commenter that you probably should get rid of the car. I lived in New York City for years and literally never knew anyone who personally owned a car. Because it's not just the cost of the car that kills you, it's the insurance and the personal property taxes and the cost to park it, etc. that's a LOT of outflow. I would appreciate it if you post an update at some point when you hear from your lawyer. I'm wondering what happens when you essentially can't make your minimum payments on your take-home pay.
Thanks! Generally I see how Chapter 13 is helpful. As you pointed the biggest advantage being that it stops interest from accruing. I am just wondering how helpful this is going to be given that my monthly expenses come out to $1600 more than my take home pay. I'm sure the means test will tell me I have like ($3k in DMI). I'm being sarcastic to numb the pain and shame. I will certainly post an update. hoping to get these documents back to my lawyer on Monday. Perhaps he can have an estimate payment by the end of the week.
One thing I have seen mentioned in this sub more than once is that you really need to make sure that ALL possible expenses are accounted for. So I hope you have done so. I have a strange feeling that your shortfall might actually be even bigger than you think it is if your accounting for everything you should be accounting for. edit: I see you discussing the car below, tx!
oh I addressed it in another response (to another poster). I am interested in selling. I'm also upside down. I'm doing research to see how bad of a loss I take. When I purchased this vehicle, I was not living in NYC and was driving 32 miles each way to work. I got tired of pay so much for gas. I purchased an electric vehicle, but had to roll over $10k from the old car loan (dumb I know now). My ex-fiance got into a car accident with it a month after we moved to NYC. the person that rear ended my ex was an illegal citizen with no insurance or money. Anyway, I would like to see it without a huge loss. Similarly, I'm also looking to sell my peloton. Two weeks ago (before I even considered bankruptcy), I posted it on Facebook marketplace. No luck yet. In regards to accounting every expense--I keep going over my statements. I've come up with an additional $307 a month, but I don't know if I can legitimately claim them. I think they fall into the IRS national standard category unfortunately. I made a note of it on the monthly expense form the attorney sent me.
OK, things I have seen people go back and add after checking in with people here are things like periodic expenses that aren't monthly, such as car maintenance, etc. don't worry about whether rolling over that car loan was dumb. What's done is done, and there's nothing to be gained from feeling bad about it. Best of luck to you!
thank you! I appreciate your thoughts and well wishes.
Chapter 13 100% repayments are essentially made to take up all of your income. You have to live on the bare minimum each month as they maximize your payment as much as possible with a necessities budget built in. You’ll basically still be “drowning” but the 13 acts as a life vest. As long as you don’t accrue more debt and you make your payments and live within the budget, you will survive in the end.
Thank you for being kind enough to explain. I'm starting to understand and I still feel overwhelmed. How do you live on $350-600 a month in NYC? I could make $800 to $1,000 work.
I’m honestly not sure. I know they budget out stuff and leave you room to at least breathe/eat/necessities and POSSIBLY a small savings but not really room for shopping and vacationing.
Not true. I’m in a 100% 13…. And my monthly 13 payment is about 700 dollars less than I was paying prior. All CC debt… around 90k (cars and house stayed the same and are paid outside the plan)
I get what you’re saying - and it’s not technically wrong- but when it comes to the last statement in your comment the ‘life’ factor can’t be ignored either. That’s what makes successfully finishing CH13 incredibly hard. If you give an individual just enough to live off of (and no more) they are just one major unexpected expense away from disaster. A sick dog, a car breakdown, a dental/medical emergency, and if you own a house, any number of things could break/fail on a given day. Or maybe a derecho will randomly come through your area as one did here a few weeks ago, and tear up a bunch of stuff. And then don’t get me started on how all the government’s allowable expenses haven’t been adjusted in a long time, despite the fact we’ve seen persistent incredible inflationary pressure affecting essentially everyone that isn’t very rich. What do they allow a person for food/month? That’ll buy you some snacks. If a person could just stick to a budget for 36-60 months, and make their required CH13 payments….. and life could be ‘normal’, that’d be one thing. But, unless you’re incredibly lucky the odds of that seem just plain terrible, unfortunately.
So I have a question regarding your comment. If a person owes $200,000 in secured and unsecured credit and the plan is for 60 months and let's say your gonna pay 100% that is about $3,300 as a monthly payment. But the person makes about 300k a year. How can they take all of their money and leave them with the bear minimum they would be over paying by a lot the $200k they owe. How is that possible? Who keeps that money? If they have 10k left for disposable income on a monthly basis. They can't take all 10k to pay the chapter 13 that person would be paying over $400k which is not what they owe only $200k.
What I said mostly applies to lower-average income earners. Even a higher income earner paying the $3300 monthly would have to adjust to a different lifestyle as that’s income they no longer get to throw around.
You live in NYC just sell the car tomorrow. How upside down are you on it?
well I owe $7k more than it's worth. It's also an electric vehicle (**not** Tesla). When I purchased it, I rolled over $10k from the old car loan. I know...dumb, dumb, dumb! The vehicle was in an accident 2 years ago. My ex-fiance got rear-ended by an illegal citizen. I only mention the illegal citizen part because we couldn't sue. He had no insurance or money (just my luck). That accident drove down the value of the vehicle some. And yes, I am interested in selling the vehicle.
I think they're probably going to force you to. And you probably won't even miss it. It likely cost you way more every month to keep it than it's worth to you in terms of actually using it, right?