Trustee Commision

[chloe0724]

So how does the commision for the trustee work? If you are in a plan for 60 months and say you are at 50% payback, does that 50% include the trustees %?

[Flamingo]

So how does the commision for the trustee work? If you are in a plan for 60 months and say you are at 50% payback, does that 50% include the trustees %?

The Trustee's commission is based on a certain percentage of your Plan payback amount. We were at 64% for unsecured and 100% for secured and paid the trustee 9% stretched out during the course of the Plan.

[lrprn]

So how does the commision for the trustee work? If you are in a plan for 60 months and say you are at 50% payback, does that 50% include the trustees %?

Here's the link that has the latest Ch 13 trustee admin % agreed on by each state if you filed after March 17, 2008 - http://www.usdoj.gov/ust/eo/bapcpa/2...3_exp_mult.htm . These fees are typically updated about every six months, but can be adjusted more of less often as required.

The trustee's admin % comes off the top of your payment every month.

Your Ch 13 payment is disbursed by your trustee in a very specific way set by the bk law. Your laywer's payment, any mandatory monthly payments like child support, and the trustee's admin % come off the top first. Next your secured debts like autos that are being paid by your trustee are paid by what is left until these are paid in full.

AFter that your priority debts (IRS, etc) are paid with what is left over after the monthly take-outs until those are paid in full.

Last after your lawyer's fee and your secured and priority debts are paid in full, the non-secured creditors finally start getting a piece of the pie. That piece of the pie is the "payback %" you hear about all the time.

The trustee will continue to get his/her monthly admin % fee until your case is officially discharged.

[chloe0724]

Ok,

So since I only have unsecured debt in my plan, then the trustee will get his cut first and then the creditors will start getting theirs. Am I correct in assuming that the amount the trustee is paid is taken away from the unsecureds? Since we only have a set amount we can pay each month, then the % of payback is affected by the trustees fee.

[woeisme]

That is correct chloe0724, the monthly amount you can pay back is set by the paperwork and schedules, and the trustees payment is part of that, so what you pay back to unsecured is reduced by this payment. For example, my payment is $1100 a month, and my trustee takes 2.7%, so only $1070.30 goes to my creditors, the other $29.70 goes to the trustee. So if I was calculating my payback percent, I would use the $1070.30 x 60 as total amount paid, divided by total amount owed x100 to get percent payback. This payback % number may also change from the amount you intially proposed (in our case 65%) because not all creditors may file claims, or the amount they file may vary slightly from what your initially estimated, etc. In our case, some claims were a little higher than we thought (took a while for paperwork to get processed and of course interest was accruing on debt all the while, plus late fees) but then we had several who did not file, so in the end I think we are going to end up paying back about 75% to unsecured instead of the 65% we proposed. In the end, it doesn't really matter, the monthly payment is all that counts, who gets paid what and when is all up to the trustee now.