Results 1 to 2 of 2

Hybrid View

  1. #1
    Join Date
    Feb 2012
    Posts
    1

    Default Chapter 13 vs. Chapter 7

    My question involves bankruptcy in the state of: Florida

    I am currently in default on two homes which will result in either a $200k deficiency judgement or 1099. I have about $20k in liquid assets and owe $20k on credit cards so I assume the unsecured debt will be taken care of with my assets and the secured loans will be discharged.

    However, an attorney advised me the banks may now include the amount of the loan which exceeds the value of the home to the unsecured debt. This could result in my owing more. I understand the banks have four months after filing to submit this claim.

    The attorney also advised me that filing chapter 13 would be advisable since I have the option to back out. However, I might qualify for chapter 7. He told me the chapter 7 trustees are more aggressive and likely to advise the bank to file the unsecured debt. His fees for chapter 13 are $4700 and 7 $2200.

    One more concern is the amount of my unsecured debt is just over the limit of 1,000,000 (close to that) and I may not qualify for chapter 13. Although he said he could submit it to see if goes through, I would still be liable for his fees if it doesn't.

    Any suggestions?

  2. #2
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Chapter 13 V Chapter 7

    I am currently in default on two homes which will result in. . . a $200k deficiency. . . I have about $20k in (non exempt) assets and owe $20k on credit cards. . . (A)n attorney advised me (that the foreclosing lenders). . . have four months after filing to submit this claim. The attorney also advised me that filing chapter 13 would be advisable since I have the option to back out. However, I might qualify for chapter 7. He told me the chapter 7 trustees are more aggressive and likely to advise the bank to file the unsecured debt. His fees for chapter 13 are $4700 and 7 $2200. One more concern is the amount of my unsecured debt is just over the limit of 1,000,000 and I may not qualify for chapter 13. Although he said he could submit it to see if goes through, I would still be liable for his fees if it doesn't.
    1. Debt limits for a Chapter 13:

    $1,081,400.00 for SECURED debt
    $360,475.00 for UNSECURED debt

    2. Non exempt assets in a Chapter 13 are protected so long as you pay to your unsecured creditors the value of those assets over the life of the Plan.

    3. Non exempt assets in a Chapter 7 will be taken by the Chapter 7 trustee for the benefit of your creditors.

    4. Creditors have the right to file claims in either Chapter. Some may choose not to. In a Chapter 13 you have the right to object to claims assuming you have a valid reason to dispute them. In a Chapter 7 you do not have standing to object unless you are a “solvent estate”.

    5. If you otherwise qualify for a Chapter 7 and do not care about the non exempt assets, consider it as you will obtain your discharge (assuming no creditor objects) within about 4-5 months, instead of being stuck in bk for 3-5 years.

    6. If you want to protect your non exempt assets do not file a 7. If you are below the debt limit file a 13. If you are above the debt limit think about a Chapter 11.

    Being able to dismiss the 13 (can’t just back out of a 7 or 11), is not a reason to file a 13. You have to decide what you are trying to accomplish. Do not let the attny push you into a 13. Consult with several attnys before making a final decision.

    Des.

    1. Sponsored Links
       

Similar Threads

  1. Replies: 7
    Last Post: 01-15-2012, 11:13 AM
  2. Chapter 13: Trustee Dismissing Chapter 13 Bankruptcy, Can We File Chapter 7
    By craigandnay in forum Bankruptcy Law
    Replies: 2
    Last Post: 06-14-2010, 06:23 AM
  3. Chapter 13: Conversion Of Chapter 13 To Chapter 7 - 8 Years After Chapter 7 Discharge
    By daybyday in forum Bankruptcy Law
    Replies: 2
    Last Post: 05-28-2008, 03:56 PM
  4. Chapter 13: Converting From Chapter 13 To Chapter 7 - Will The Trustee Refund My Payments?
    By NBHAMBLESSED in forum Bankruptcy Law
    Replies: 5
    Last Post: 09-27-2007, 11:31 AM
  5. Chapter 7: Mortgage Payments and Converting Chapter 13 to Chapter 7
    By NCDESPERATE in forum Bankruptcy Law
    Replies: 1
    Last Post: 09-03-2006, 09:38 AM
 
 
Sponsored Links

Legal Help, Information and Resources