Ch 13 Dismissal and a New Car Loan or Refinance??

[KathyInWI]

I read a previous post from someone that US Bank was helpful for car loans, granted at 24% interest; but still helpful and willing to work with peopel. I am currently in a Ch 13 that will be dismissed w/in 30 days...I have a 2007 Equinox that I don't wanna lose (financed thru wells fargo) but I know I could lose it (have it repo'd) when the 13 is over if I can't pay all the back payments and interest up front...(My attorney sucked to put it mildly and led me very very astray) I'm trying to make it all right; and I know its a long road; more than anything I wanna keep my car. Does anyone have any other thoughts, suggestions?
Thanks
Kathy

[Denita]

I noticed you are in Wisconsin.

Wisconsin has a neat law that is Ch 128. It is similar to a Ch 13, but you can pick and choose which debts to put in or leave out and that might work for you in this case.

Naturally I don't know your situation, but if you had trouble with the ch 13, the 128 might work better for you.

Getting a loan at 24% or anywhere similar is not going to help you. What you need are smaller payments on a vehicle not high interest pmts.

Are you in an area where public transportation will work until you can get squared away on the debt you do have?

Or can you tell us what happened with the Ch 13...I know not every BK attorney can write a good plan for a 13 that's why many fail. You might just have a good alternative because you are in WI (that is the only state I know of with this 128 law).

[KathyInWI]

Denita,

I have never heard of a Chapter 128...hmmm....I will have to look into that; thanks!

We do have public transportation; but it doesn't go out to my Sons' schools or to my job...so, yes we have it; it's just not practical for me and my two boys.

In the Ch 13...the attorney made it sound like a glorified repayment plan...when I orginally hired him (partly my fault; didn't do my homework) I trusted him and took everything at face value...he said that I would have to turn over half my tax refund every year and the month I did this, my attorney sat on my case for nearly 8 months without filing...no idea why...when I called him I was told by his paralegal he no longer worked there, and that she/the paralegal would be handling my case...(first red flag).

Okay - back to the taxes, my original attorney told me that I didn't have to my my normal payment when I submitted half my refund...and he told me only federal had to be submitted; not state. (did this for two years before the Trustee sent me my first dismissal letter) the paralegal filed a new/modified plan raising my payments and adding more time on.

When I first went to file a Ch 13 I found out after the fact that if the attorney would have waited about 45 more days that my car amount could have been reduced because it was 'older' or something at that point; and the depreciation or something was more...so again - he didn't inform me of everything...partly my fault; I could have done my homework more.

I have told my paralegal many times that the payments are too high; I'm a single mom with two boys...she basically told me there is nothing she can do, so she advised me to let it get dismissed...

Thanks

[Denita]

You are right about the red flags.
Having a paralegal design your plan is not really the way to go.
I don't understand why you were in a Ch 13 to begin with - was it to keep the car? Most people can file a Ch 7 unless they want to keep assets.

Don't give up on attorneys. Your credit is probably trashed due to the Ch 13 dismissal. Line up a bunch of bk attorney's in your area to interview. Also line up attorney's that can work with you on the 128. See which will work out best for you from a recovery point of view.

As to a vehicle: after my Ch 7, I bought a cheap beater and drove that for 2 years until I could get back on my feet enough to go buy one with a decent interest rate.

The car dealerships take advantage, IME, of people just out of 13's and 7's if you try to finance something right away. This is JMO based on going through the same process a few years ago. Jumping back into something with a high interest payment puts you right back into the awful cycle of subprime loans and crummy cars. Car payments keep us broke. If you own a beater than you have repair bills. But it is better to pay the repair expense than to pay a high car note and a repair expense IMO. Stay away from the Buy Here Pay Here type too if you can.