Lost job...now what??

[ingrak]

My husband & I filed chapter 13 bankruptcy in September 2005...we are in a 100% plan where we have had the payments deducted from my payroll every month. Currently all of our secured debt is paid off & we are within 8 months of having our bankruptcy paid off - should be 3 months earlier than original plan. Anyway, today I was notified that due to the economic situation I was being let go after 21+ years of employment. Today was my last day....I normally get paid once a month & will be paid thru the end of this week. I was told that this was in no reflection to my performance...just the economy in general. In fact several hundreds of individuals were being let go. I will receive a severance package which will NOT be paid in a lump sum, but will be spread out over several months. But, now I am not sure how this will affect my bankruptcy. We filed under the old law....can we have our attorney petition the courts to end our bankruptcy? Or, will we have to satisfy our chapter 13 payments? Will the courts make me turn over portions of my severance package? My severance also forces me to apply for unemployment benefits - does my unemployment pay go to the trustee as well? Note that with the current state of the economy and the area in which I live....I will not have any luck at finding a position that pays even close to what I was making....Any advice is welcome! I am going to contact my attorney (or, at least make an attempt - not very reliable) tomorrow....but, was curious whether anyone had an experience similar to ours....

[liz417]

So sorry to hear about your job loss, especially after so many years with your company and so close to finishing your repayment plan. Because of your job loss, you can convert your ch 13 to a 7.

Good Luck!

P.S. There was another poster (can't remember name, but within the last week) that was within a few months of finishing his ch 13 and he lost his job too. His attorney advised him to put away his severance pay and continue paying his monthly payment to the Trustee (situation a little different from yours, he got a lump sum serverance).

[DebtSlave]

I have no advise for you but I want to wish you well.

[HHM]

You either need to amend your chapte 13 plan to lower the payment or convert to a chapter 7.

[Flamingo]

In our Old Law plan was a paragraph that stated if we lost a job or income we still had to pay our plan payment. In your situation, since you received a severance package which will not allow you to obtain unemployment until it is gone because it is income for you for a certain period of time, you will have to make your plan payment out of those funds just as if you were receiving income. Don't play guessing games here - call your attorney and find out what you need to do in your situation.