What happens after a Ch 13 has been dismissed?

[southerncomfort]

Here is some background:

We filed a Ch 13 in Feb 05 (a 36 month plan). We have paid in $69,000 which has paid for the crammed-down value of my car with the reaminder going to student loans. My house was and is current and is paid for outside of the plan. My case was dismissed in late May and motion to reinstate it will be heard next week. We still have our regular jobs and have the money to pay the plan, we just fell 2 payments behind (in January) although we have since been paying our $3,000 + payment monthly. We weren't even 60 days late and we were dismised.

My question is this-- what will the creditors do (unsecured creditors mainly all now with ecast settlement corporation) do if our case is NOT reinstated? The unsecured debt totalled $120,000 and was being paid back at 0% in the plan. Obviously, I am praying the plan is reinstated.

Will the unsecured creditors attempt to make payment arrangments with us or will they sue us and get a judgment against our house? I can't understand why this would be more beneficial to them since we have little equity in our home and we could pay them more in a payment arrangement than they would receive from the profits from our house. Will they make arrangments to accept less than the full amount of the debt?

Has anyone had their Ch. 13 dismissed and thereafter negotiated with creditors to pay their debts? Does anyone know what the standard operating procedure is for the these settlement corporations? We have enver been sued or had judgments against us and I am terrified of it happening.

[lrprn]

We still have our regular jobs and have the money to pay the plan, we just fell 2 payments behind (in January) although we have since been paying our $3,000 + payment monthly. We weren't even 60 days late and we were dismised.

Those are the rules of the Ch 13 game - you make your trustee payments on time every month or you get dismissed. There is no grace period. Did you ask your lawyer to notify the trustee's office you were going to miss payments? What happened that you fell two months behind?

My question is this-- what will the creditors do (unsecured creditors mainly all now with ecast settlement corporation) do if our case is NOT reinstated? The unsecured debt totalled $120,000 and was being paid back at 0% in the plan.

If your plan is not reinstated, then you will owe the entire $120,000 plus all the interest and late fees that have accrued since you filed as well.

Will the unsecured creditors attempt to make payment arrangments with us or will they sue us and get a judgment against our house? I can't understand why this would be more beneficial to them since we have little equity in our home and we could pay them more in a payment arrangement than they would receive from the profits from our house. Will they make arrangments to accept less than the full amount of the debt?

One thing for sure - your creditors will come after their money. How they choose to do will depend on the kind of debt it is.

We have never been sued or had judgments against us and I am terrified of it happening.

Unfortunately this is the door you opened when you didn't make your Ch 13 payments. If your case is not reinstated (and I hope for your sake that you have a forgiving trustee), then you will be sued for payment. And since you owe the money, unless you live in a non-garnishment state, you will see wage garnishments plus liens placed against your assets as well. If your Ch 13 is not reinstated, then you are in for a very rough ride.

[BKOnce]

Phone rings again... letter threats... door knocks.... restless... insomnia... stress therapy.... health deteriorates.. house lost.... divorce... etc.. and more etc...

[southerncomfort]

Thanks for the responses.

[southerncomfort]

One thing for sure - your creditors will come after their money. How they choose to do will depend on the kind of debt it is.

Like I previously said, It is unsecured credit card debt. So how will they choose to come after me?

[HHM]

Like I previously said, It is unsecured credit card debt. So how will they choose to come after me?

"Eventually" you will be sued. But you can expect the typically collection efforts to restart, letters, phone calls, etc. The debt will probably get sold to junk debt buyers, who will probably sue you.

[southerncomfort]

"Eventually" you will be sued. But you can expect the typically collection efforts to restart, letters, phone calls, etc. The debt will probably get sold to junk debt buyers, who will probably sue you.

Prior to filing Ch.13 we were not in arrears with the CC companies, so I have never had any of these letters, phone calls, etc.

I believe the debt has been sold to junk buyers--ecast settlement corporation-- I guess my main question is what is the point of suing if I am willing to make a payment arrangment? Would there be any reason to sue if the debtor agrees to pay back the debt?