Results 1 to 4 of 4
  1. #1
    Join Date
    May 2014
    Posts
    2

    Default Loss of Income During a Chapter 13 Plan

    My question involves bankruptcy in the state of: Ohio

    First I would like to explain our circumstances concerning our Chapter 13.

    Our plan was confirmed in May 2012, it was a 100% 60 month payment plan.

    The original amount for all the creditors was $279,864, however the amount actually claimed was only $174,501, many of the unsecured creditors never filed a claim...some may say we were very lucky.

    I have been making direct payments to the trustee of $4,895 each month, no garnishment, never missed a payment and was never late. If you do the math you will see that the plan would be payed off in 36 or 37 months instead of the 60 months.

    My wife lost her job about 6 weeks ago, and without her income I could not afford the full $4,895 payment due the beginning of May. I consulted with my attorney who talked to the trustee...the trustee said if I missed one payment it would not be a big deal based on my previous payment record but to send in whatever I could....I payed a total of $1,000.

    My wife has still not secured a new job, has a couple of possibilities but nothing for sure. Talked to my attorney this morning, he felt we should file for a plan modification, I'm not sure if that is the best course of action.

    I've read on the Internet that it may be possible to get a payment deferment for a few months. Even if I missed 6 payments I would still have the plan payed off 18 months early.

    This is new territory for my attorney, as he admitted to me...usually he is begging the trustee and the court for leniency for his clients because they are not making the effort to make payments, he has very few if any that are in my situation of paying the plan off early.

    I have a ton of respect for my attorney but thought I would ask for a second opinion and maybe get some guidance on a payment ferment plan if that is in fact an option.

    Thanks so much for your help.

  2. #2
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Loss of Income During a Chapter 13 Plan

    A Modified Plan can provide for a reduction in the monthly payment (as well as a waiver of any missed ones) while a Motion for Moratorium only provides for a waiver of payments with the debtor resuming payments at the prior level (or even a higher level if the missed payments must be "caught up".)

    If you do not need a reduction in the monthly payment I believe a Motion for Moratorium is the proper pleading to file. If, however, you need to reduce the monthly payment going forward, the Modified Plan is appropriate.

    So, the question is. . .

    Can you resume payments in a few months at the current level or do you need to reduce them going forward and remain in the Plan for the full 60 months if that is what it takes to pay 100%?

    Des.

  3. #3
    Join Date
    May 2014
    Posts
    2

    Default Re: Loss of Income During a Chapter 13 Plan

    Thanks for the reply Des...we are about 24 months into the 60 month plan (100% secured and unsecured) at the current monthly payment we will have it payed off in 12 or 13 months, 24 months early.

    Assuming my wife gets a job we would easily be able to continue at the current monthly payment, I would prefer to file for a Moratorium, start the payments back up once my wife finds a job and be done with it in the next 15 or 16 months.

  4. #4

    Default Re: Loss of Income During a Chapter 13 Plan

    Wow, which lenders did not claim all of that debt? I am filing my chapter 13 tomorrow and was hoping some of the lenders would not claim but I don't think I will be that lucky. I will be on a 100% plan for 60 months.

    Thanks

    1. Sponsored Links
       

Similar Threads

  1. Chapter 13: Increased Income During a Chapter 13 Repayment Plan
    By ktmguy in forum Bankruptcy Law
    Replies: 2
    Last Post: 04-30-2013, 09:25 PM
  2. Chapter 13: How is Income Calculated for a Payment Plan
    By Notez35 in forum Bankruptcy Law
    Replies: 2
    Last Post: 02-20-2012, 02:15 PM
  3. Chapter 13: Paying Off a Chapter 13 Plan Early, 100% Repayment Plan
    By mjsantos in forum Bankruptcy Law
    Replies: 4
    Last Post: 06-04-2011, 08:59 PM
  4. Chapter 13: Loss of Job in Chapter 13
    By jmjens2 in forum Bankruptcy Law
    Replies: 1
    Last Post: 09-04-2009, 10:56 PM
  5. Chapter 13: Income Changed During Chapter 13 Payment Plan
    By lewmel in forum Bankruptcy Law
    Replies: 4
    Last Post: 11-05-2007, 06:21 AM
 
 
Sponsored Links

Legal Help, Information and Resources