Does Trustee Verify Income Prior to Payoff Calc?

[BK_Broiler]

Hi. I am in a 60 month Chapter 13 plan under the old law, and am currently on payment #28. I am considering selling my house, using the equity to pay off my chapter 13 plan, and buy a new home with my girlfriend.

Does anyone know what the process is for the trustee to provide a payoff statement? Do they verify your current income? And I guess they will charge for providing the statement? Thanks for any advice you can provide.

[aa06a47]

Bk, the rules for old law is that if you pay off prior to 36 months, you have to pay 100% of the debt filed on + the trustee fee's for that amount. If your current payback is less than 100%, then you would be wise to wait to the 36 month period, at which time you can request a payoff amount and get out of jail..I mean Bankruptcy.

I do not believe they go through an income verification prior to a discharge.

[jenrw74]

Ours was 60 months too. We requested our payoff amount back in January, at month 35. The trustee's office let us email the payoff request stating where the money was coming from that we were using to pay it off. We were allowed to use our tax refund.

Our BK handbook stated that it may take awhile to figure the payoff and to be patient, but we actually got it the next day. They basically just do some simple math on your case. It's an estimated amount really. They never checked anything that had to do with our current paychecks or checking account or asked us for any information. After they post your final payment they just do the final audit of the accounting of your case and submit it to the court for discharge. It's all very simple (and boring) and they don't charge you extra for any of it.

BUT if you're not in a 100% plan you have to wait until you've reached that 36 month mark before you can pay it off.

Sorry if this was long!

[BK_Broiler]

aa06a47 & jenrw74,

Thanks for your replies. That info helps out a lot. Even though I have to wait until the beginning of next year to request payoff at month 36 (my plan is not 100% payback), it is certainly something to look forward to.

The idea of selling my home to buy a new place is like a new beginning, which figuratively and literally can't happen until I get out of this bankruptcy!

If there's one thing that Chapter 13's learn, it's patience. ;-)