Just getting started on Chapter 13....

[Buckeye1974]

I need all of your expert advice. We recently filed our Chapter 13 and have our court date set. I have been reading lots of threads about the 90 days that creditors have to file that they have a valid claim. My lawyer said it's actually 4 months. Huh?

When does the clock start for my creditors to file a claim? And if at the end of the claim, are they outta luck for getting any money back?

We have a 5 yr plan and are above the medium for a family of 4 in Ohio. Im pretty sure he said we are in 100% payback.

What exactly does that mean? (100% payback).

Thanks everyone!

[woeisme]

100% payback means that he is proposing monthly payments that will cover paying back all of your debts. If your debts are $100,000, for example, you would have to pay back over $1700 a month over 60 months to pay it all back plus the trustee's fee. The payback can vary depending on type of debt, you'd need to pay secured and most priority claims (like your lawyer's bill, some tax debts, etc) at 100%, but might pay a lower percentage to unsecured creditors.

The clock is 90 days for regular creditors, 180 days for government creditors. I think a creditor can argue that they weren't properly notified in time and get a claim through if it's late, for example, I had to add a creditor 2 months after I filed, and they of course were not subject to the same 90 day clock since they were notified later. I also had one creditor claiming not to have gotten notification (all I had was a PO box for them and they claimed not to get the court notification) so they also got an extension to file a claim. So the 4 months might be your attorney's way of telling you that at that point, you'd probably be done with creditors filing claims, but he didn't want to put the 90 day clock on it because there are exceptions? I'm just guessing though.

[woeisme]

PS: are you in the southern or nothern district in oh? I am in the southern, my trustee is Frank Pees and he's been real decent so far. A few objections to the confirmation, but my lawyer was able to get them worked out without an increase in my plan base.

[Buckeye1974]

Woeisme,
I am in the Southern District too. Is there any way of finding out who the trustee is or is it only one person for the whole district? My lawyer said the trustee is a very nice person and is easy to work with so that made me feel much better. Thanks for the answers too!

[woeisme]

I think there is a different trustee for Columbus, Dayton, and Cincinniti (sp?). I never actually met my trustee (Columbus) but rather one of his many workers took my statements on tape at the 341 meeting. He has been very reasonable about what he's allowed our expenses to be, I'm finding it fairly stress-free so far (knocking on wood as I type!) My husband recently had to take off work for the past month on disability and probably for a least a couple months more, so I'm a little worried that we might have to go back and ask to have our plan changed (right now are still managing ok but over the long term could be bad) so I hope he stays nice if that happens.

[woeisme]

also, it should say on your paperwork for your court date who your trustee is I think.

[Buckeye1974]

I am in Columbus too. I haven't seen my paperwork yet so I will be sure to check it when it finally comes. Thanks again for your reply!

[EndInSight]

Now how cool is that, to have such great info from a fellow BK'er and in the same area, even!

Good Luck!

Ya gotta thank those "nerds" for all this great techno stuff!

Miss Posh

[seanf12]

Is 100% payback fairly common for people who are above the median in their particular state/district?

[Buckeye1974]

I am very thankful for this website. I have asked my lawyer lots of questions based on what I have read here!

[rrockinggramma]

I really don't think that 100 percent payback is the norm. But so much of it depends on how many claims are filed.

[lvarn]

Our plan was set up 100% because we have equity in my office building, and we didn't want to lose the building. The only way to keep the building was to go 100%.

[holding on]

Lvarn, I may be cutting hairs here, but I wanted to clarify since this got me confused when I first started researching Ch 13.

When you say "The only way to keep the building was to go 100%.", Do you really mean the only way to keep the building was to do a CH 13? And thus because of income/assets etc, you ended up paying 100%? I remember reading someone say you had to pay 100% back in ch 13 (because I wanted to keep my house) and it had to be done in 5 years and I nearly tore my hair out because with all of my debts and my income there was no I could pay 100% back in that time. Turns out I was wrong on several counts.

[lvarn]

Well, for me it was the only way. We had back taxes about to levy, and they were threatening to seize the building. That combined with a ton of unsecured debt, and the problem was just getting worse each month. We couldn't get a loan to get the equity out of the building due to our beacon score. So we filed 100% with a payment of $6,500 per month, not including the house cars and office building. So far we have made 2 payment into the plan and I just hope we can make it 5 years.

[woeisme]

Honldingon, I think what people mean when they say they had to pay back 100% to save their whatever, it's because they are trying to protect their equity in it. The way the law is written is that a CH 13 plan must be set up so that creditors will get back at least as much as they would if you filed CH 7 and the trustee liquidated all the non-exempt assets to pay creditors.

So if someone has 100K worth of non-exempt equity in a house, building, etc., or other non-exempt assets, then their CH 13 plan must propose to pay back at least the 100K the creditors would have recieved if the filer had declared CH 7 BK instead. If you think about it, it's only fair or else someone could have a million dollars worth of assets and then lose (or quit) their job and make below the median income, propose a $100 per month payback on $250,000 worth of unsecured debt for 3 years and come out of CH 13 BK paying back only $3600! Not fair when they have a million dollars worth of gold bars in their bank vault, right? So the CH 13 BK judge says no way, if you want to keep your million dollars worth of assets, you have to pay back 100% of the quarter million dollars worth of debt you have.

Now of course most filers don't have so much $ in assets, say they only have 25K in non-exempt equity in their house, a much more likely scenario. They owe 100K in debt. Well, this person must propose a CH 13 where they pay back at least 25K (again, the amount the creditors would have recieved in a CH 7 asset case). So they could keep their house, and the non-exempt equity in it, just so long as the creditors aren't hurt in the process. Probably your situation, you could keep your house without paying back 100% because your non-exempt equity in your house was less than what 100% of your debt would be.