Question: CREDITORS OBJECTING

[MajorMike]

How often to creditors object to the discharge in a Chapter 13?
If they DO object, I know we go to court, but what could happen?

[EveryDayAdam]

from what I understand, it's not often, and it's usually only for a good reason: like you acquired the debt within 6 months before filing, or they think that you might be able to afford a higher payment in a 13.

if it does happen, then it's largely only going to affect that one creditor's discharge...only his portion of your debt won't be discharged, and even then, it's only worth it for pretty large amounts of money...they aren't going to spend money on a lawyer for a $500 balance...you're looking at the $3000 range before they hire an attorney to file those.

in the instance where they think it's not enough money, the judge is going to trust the trustee on that one...if your trustee filed for plan confirmation, then you shouldn't need to worry about anything changing because of a creditor objection.

[MajorMike]

We were confirmed at the 341, but they can still file an objection until the end of March.

[jgarton244]

We had two creditors object, but the trustee ruled against them.

[helpsoneeded]

objections

What if a creditor does object, i know you have to pay them, but when? Would it be after the bankruptcy is over or during it, and if its during it does that mean you get to pay less towards the 13 payment plan?

[lrprn]

What if a creditor does object, i know you have to pay them, but when?

First of all, just because a creditor objects doesn't mean they automatically win. They have to prove to the court that their debt deserves to be paid in full. Believe it or not, this is pretty hard to do.

Would it be after the bankruptcy is over or during it,

Depends on how the objection turns out and if the creditor wins keeping their debt from being included in your Ch 13 plan.

and if its during it does that mean you get to pay less towards the 13 payment plan?

Ask your lawyer about this one. I don't know if after a creditor wins their objection if the payment plan worked out can be included in your Ch 13 plan or not.

[HHM]

It's actually quite rare for a creditor to object in a chapter 13.

Generally, if there is an objection, it usually has to do with a secured creditor not getting the value of their lien and therefore they are objecting to the feasibility of the chapter 13 plan, itself. If the creditor wins on feasibility grounds, the chapter 13 is dismissed. But unsecured creditors rarely object in a chapter 13, unless there has been actually, capital "F", Fraud.

[kmb]

We had a creditor object because we had 3 accounts with them totalling about $35K. They objected because we were only scheduled to pay about 15% into our plan and they thought we could pay more. We actually hadn't used the cards in probably a year because we were trying to go through CCCS at the time, so they had long been cut off. They felt our daycare costs were excessive as well as other areas. While we provided documentation of everything to our lawyer, he felt that the only way we would be able to get rid of them was to agree to a higher payment, we we went up to 22% and got confirmed at that. We cancelled our 401K contributions and got tighter on our budget, and are living paycheck to paycheck now, but that made the creditor happy enough that they dropped the objection and are included in the plan to get 22% of what was owed.

I'm hoping for light at the end of the tunnel when my son goes to kindergarten in the fall and I'll have a few hundred$$ left over each month due to decreased daycare costs for him.

[MajorMike]

I think this is why our creditor ( amex ) will object. I had a pay off the entire balance card at the time 4 months before filing and bought 2500 in gift cards to sell for cash to pay some bills thinking I would pay them off in the next month with my huge commission. The thing is, my sale got pulled and I couldnt pay the card off. I didn't intentionally not want to pay them but they are thinking so. If they object, I will have no problem paying them, but the question is when and how!!??

[kmb]

Majormike

AmEx was our only objection to--our attorney said they are starting to do more and more of that in these instances. They were jerks---kept filing for continuances and even though our 341 was in June, we didn't get confirmed until November.

[MajorMike]

what eventually happened though? We're already confirmed. Did you go to court? What was your situation?

[MajorMike]

Well, Amex sent another letter to my attorney stating: 2ND NOTICE
So, my attorney called and said I needed to come in and talk to him about it. The appointment is next Weds but Amex said in the letter they know they only have til the 8th to do something about it but with the extension the judge just gave them, they now have until the end of March!! Great, now I have to worry about this!!
My attorney's secretary said it rarely happens in a 13 but that they would deal with it and not to worry. I guess my attorney has to tell them SOMETHING as to why we ran up charges within 90 days of filing.

[kmb]

We didn't have to go to court, our attorney went for us. The AmEx lawyer kept continuing the case because he was getting married, going on his honeymoon, etc (and we wouldn't want to interfere with his personal life now, would we)? On the last date, the lawyer and trustee asked him what he wanted (which it said in his objection, they wanted more money paid into the plan), our lawyer told the trustee we would up our payments, the AmEx lawyer said "whatever the trustee decides is fine" and he left before a final ruling was made! Had he still objected, the court would have scheduled a court date that we would have had to go to, but up until this point, our lawyer handled on our behalf.

[MajorMike]

Well we're already at the limit. When our trustee saw on paper that we didn't have enough to fund the plan because we HAVE to give unsecured at least 5% ( you can't not give them zero in our district ), our attorney said that we would cut back on our food expense to be able to afford it. In reality, we can afford it easily but how is Amex going to try to get more out of us when according to our trustee, we are not able to.
I hope our attorney takes care of it as that's what he is paid to do! I will gladly pay Amex $100/mo but how do we explain to the trustee that now we have more? I'm kind of stressed about the fact that they think we did something fraudulent too. Can we get in trouble for that?

[kmb]

I don't know if you can get in trouble, it's better to defer to your attorney. AmEx was contesting our daycare charges, our transporation costs (guess gas isn't $3/gal where they live) and some other random categories. We provided documentation on all our expenses to our attorney, but the one document that they looked at in conjunction with the means test "said" we could pay more even though the means test showed us negative. So we are scrimping and scraping more, but I can't imagine what the alternative would be. The courts won't let you pay more to AmEx and none of your other creditors since that is considered preferential treatment, but if you put an extra $100 in your plan, that might be enough to make them happy.

Have you seen the court papers to figure out what exactly they are asking for? AmEx wanted a higher payment each month, they weren't asking for payment in full from us.