iVillage Member
Registered: 10-01-2008
Fri, 02-15-2013 - 1:23pm

Well, I'll start with the good news.  It's Friday, yeah.  Hubby & I had a nice quite wonder super and romantic V'Day.  Next Thursday will offically mark the beginning of our last year of Chapter 13 Bankruptcy payments. For all of the above I am truly grateful.

The bad news :( .  I'll explain for all of the followers who have not been around since I joined the board in October 2008. 

In 2005 I worked a full time job in a nearby city plus, my son & I ran a small trucking company.  The company broke even, but never really made a profit.  In October of 2005, my husband suddenly lost a high paying sales job.  No real real other than the company keep raising the bar for his commissions and he kept hitting the mark and they were about to have to pay him $100,000 a year.  His fixed salary was only $32,000.  They let him go with a serverance package.  Six months of salary plus health benefits with a clause he could not go to work in this same field for 2 yrs.  We panicked, caved, took the deal.  DH was ready for a break, discussed and decided he wanted to join our son in a care free atomsphere of trucking.  We added another truck, insurance the whole deal.  We keep going deeper and deeper in credit card debt trying to keep the company profitable.  Diesel prices rose to a sky high level and by the middle of 2007 I told DH & son that we needed to close the company.  DH found a job, $60K a year, but one month later rec'd court orders to leave the job or face judicial punishment.  He left.  Our son soon found a job with Pepsi (previous employer) so that left DH back to driving the remaining truck.  We sold off the other truck and a trailer.  We refinanced our house in early 2008 and paid off one credit card that was joint with son that had a large balance of fuel charges.  For two whole months DH had little to no income.  He did not qualify for unemployment because a CPA advised me to re-pay the salary as loan repayments instead of salary so he did not qualfy for unemployment.  He took a job with ADT as a small business saleman.  It paid no salary, straight commission.  He made less than I did in my office job, under $25,000.  So his income dropped by over $75,000.  No jobs were to be found. PERIOD.  

So in January 2009, we filed Chapter 13 Bankruptcy.  The payments were $325 a month.  We struggled to make the payments with his unknown check every week.  Some weeks were good, others were terrible. We were living on less than $50,000 a year (previously $125,000).  Finally a good friend offered him an manufactures rep for a company that he use to sell their product.  This friend took a chance on a very good salesman with no college degree.  He took this job in August 2009 and has thrived.  He got $60K salary, benefits and a company car.  The Bankruptcy trustee raised our payments to $518 a week....GULP....hard....but doable.  I only netted $450 a week, so this meant all of my check went to the court plus the rest from his check.  We have struggled at times, but somehow we've always managed to make it.  Last year he got a bonus of $2,750.  We ask the trustee if we could keep it for medical (my heart and back) bills, plus dental bills for him that the insurance did not cover.  They let us keep that bonus. 

Now the bad news.  This year he hit ALL sales qualifications and we be receiving a $10,000 bonus ...before taxes.  We have to surrender ALL of it to the court for the balance of approximately $26,000 that would have been left standing had we just continued our regular $518.00 a week payments.  If anyone remembers back a couple of months ago I expressed some regret that when we came out of Bankruptcy next February, 2014 that we would walk away oweing some credit cards companies this $26,000.00.  Now that will be cut by what the net amount of this bonus will be.  All of the sudden I'm not feeling so guilty.  And before anyone ask, I spoke to the attorney and he thought our chances of keeping any of this bonus would be slim since she awarded us last years bonus for bills.  It would require meeting with the attorney, going to court (missing work) and not being guaranteed any benefit.  I say screw it, we owe it, this is to be.  Hubby is mad, peeved to say the least.  Not at me, but the whole bankruptcy system.  The attorney really said we would have a very slim chance of getting anything.  

I say forget it.  Let it go.  What's your opinion or thoughts?

All I keep telling myself is one year...52 weeks....365 days.

Community Leader
Registered: 07-26-1999
Tue, 02-19-2013 - 11:07am

Norma, what percentage were you originally supposed to pay to all the unsecured creditors in the BK?  And what will this extra money in bring that percentage up to?  I can understand your DH's frustration with having to pay it in, but as you said, the likelihood of you getting to keep it unless there was a real significant reason for it, is slim, and once you factor in the time off work, and the attorney fees that you wil end up paying through the bankruptcy court just to keep some of it, may not realy be worth it.  The only other thing you may want to explore would be to reevaluate your budget because of the increase in food and gas expenses, or any other household/medical expenses and see about modifying the plan to pay in less per week payments over the last year.  Will this big bonus bring you up to 100% paid to the unsecured creditors, or even more?  Will it end your payments earlier than the prescribed 5 years?  Those would be the first things I would check on before making any real decisions. 

iVillage Member
Registered: 10-01-2008
Wed, 02-20-2013 - 3:15pm

Hi Arryl, great to hear from you and thanks for replying.  It WILL NOT take us above 100% and put us paying back about 88% roughly.  It WILL NOT pay us out early....I ask the attorney that question when I called and pretty much expected that answer.  I told DH that we owed the debt, it's hard to swallow, but next year the attorney clearly said it was all ours.  Tomorrow marks 52 weeks left.  THANK GOD!!!!!

Take care...hope you and the girls are well.

iVillage Member
Registered: 03-17-2003
Mon, 02-25-2013 - 5:43pm

Hi Norma.  After reading your post this is how I view the situation: for all the peace of mind the protection the Bankruptcy Court and Trustee gave when you were going under (financially, emotionally, healthwise, and the unrelenting, withering stress) that $10,000 is worth it.  Not that letting that kind of money slip away when you could surely use it is something to shrug off.  Hardly!  I'm sure your husband is NOT pleased; however, one thing is certain---- you have weathered a financial crisis and in no time the bankruptcy court will be out of your hair and your husband will continue to make more money and bigger bonuses.  The other consideration is no matter how upset anyone gets about the bonus, the trustee has made a decision.  Would it be worthwhile to go back to court to fight the trustee?  Probably not.  Let your husband blow off steam and be upset.  Plan to celebrate when you are discharged.  Smile