Early payoff & other questions...

[Purple]

Hi! What a great site! I wish I would have known about it when I was FILING...lol

Anyway.....I live in Colorado, if that matters.....

I am 26 payments in on a 36 payment plan. I may find myself in a position where I can stretch and pay it off early, and would love to do so. So my questions are:

1. Is this a good idea? (I kinda always feel like if I lay low, and keep making my payments like a good girl, no attention will be called to me). So by starting this process, is it possible that the trustee can re-investigate my case and change things? Question me about where the money is coming from? Re-evaluate my income? (which is higher now than it was when I filed in 2005).

2. My car is being paid outside of the BK. It is scheduled to be paid in full before the BK date. When that is paid, will the lender then send me the title, or will they wait until the BK is discharged?

3. My mortgage is also being paid outside of the BK. If I have to sell it (a family member may need me to move in for a while and help due to bad health), do I have to notify the trustee?
What if I sell it and use the proceeds to pay the trustee in full....is that possible?

I suppose I will call the attorney next week with these questions, but she is not very responsive, so I thought I would ask here first. Any help would be MOST appreciated!!! Thank you

[lrprn]

Welcome to BK Forum, Purple...glad you did find us!

1. Is this a good idea? ... So by starting this process, is it possible that the trustee can re-investigate my case and change things? Question me about where the money is coming from? Re-evaluate my income? (which is higher now than it was when I filed in 2005).

Since you filed before Oct 2005, your case is operating under the old bankruptcy law - you're lucky. After 24 months of on-time payments in a 36 month plan, the old law stated that you could request an early payoff. Trustees are accustomed to this request, and unless you are making a substantial amount more than you were when you filed and have been for some time without telling your trustee, it won't raise any suspicions. Are you planning to refinance your house to get the payoff money?

2. My car is being paid outside of the BK. It is scheduled to be paid in full before the BK date. When that is paid, will the lender then send me the title, or will they wait until the BK is discharged?

Most 13ers here have received the title as soon as the car loan is paid in full.

3. My mortgage is also being paid outside of the BK. If I have to sell it (a family member may need me to move in for a while and help due to bad health), do I have to notify the trustee?

Yes, as long as your case is active, you MUST have the trustee's permission to sell or refinance any asset.

What if I sell it and use the proceeds to pay the trustee in full....is that possible?

Yes, as long as you have your trustee's permission to proceed first.

Please do call your attorney next week to make sure these are the right answers for your situation and match with your local court and creditor customs. Good luck - hope everything works out for you!

[Purple]

Thank you SO much for those answers. That helps tremendously. I will call my attorney on Monday.
Thanks again

[chpxiii]

Good luck, Purple. I just sent in a check for an early payoff on my chapter 13 (this past friday, yay!) and I tell you ... it's a HUGE relief. I'm still crossing my fingers, however, and holding my breath for the actual discharge.

Hope things work out for you.

[Pumpkin729]

early payoff

Lrprn....is this something new? This is the first that I am reading this? Also what if you're on a 60 month plan does this still apply?


Since you filed before Oct 2005, your case is operating under the old bankruptcy law - you're lucky. After 24 months of on-time payments in a 36 month plan, the old law stated that you could request an early payoff.

[lrprn]

Lrprn....is this something new? This is the first that I am reading this? Also what if you're on a 60 month plan does this still apply?

If you filed Ch 13 before Oct 17, 2005, then your Ch 13 case is governed by the old bk law.

Under that law, a 3-year Ch 13 case could request early payoff after two years of on-time payments. A 5-year Ch 13 case can request early payoff also - I just can't recall whether it's after two or three years of on-time payments.

Check with your lawyer - he/she will know if you qualify for an early payoff request and when.

[Flamingo]

Hi! What a great site! I wish I would have known about it when I was FILING...lol

Anyway.....I live in Colorado, if that matters.....

I am 26 payments in on a 36 payment plan. I may find myself in a position where I can stretch and pay it off early, and would love to do so. So my questions are:

1. Is this a good idea? (I kinda always feel like if I lay low, and keep making my payments like a good girl, no attention will be called to me). So by starting this process, is it possible that the trustee can re-investigate my case and change things? Question me about where the money is coming from? Re-evaluate my income? (which is higher now than it was when I filed in 2005).

2. My car is being paid outside of the BK. It is scheduled to be paid in full before the BK date. When that is paid, will the lender then send me the title, or will they wait until the BK is discharged?

3. My mortgage is also being paid outside of the BK. If I have to sell it (a family member may need me to move in for a while and help due to bad health), do I have to notify the trustee?
What if I sell it and use the proceeds to pay the trustee in full....is that possible?

I suppose I will call the attorney next week with these questions, but she is not very responsive, so I thought I would ask here first. Any help would be MOST appreciated!!! Thank you

Since you feel you might be in a position to buy out of your Chapter 13 plan early, contact your attorney (keep calling his/her assistant or paralegal to get a response) to explain why you believe you can do this. Your attorney will evaluate the situation and if he/she feels you are able to do it, will contact the Trustee. If the Trustee agrees, both the attorney and Trustee will file a Motion to allow your payoff. This Motion is not free and cost us $400 in attorney's fees as it is not considered a part of your fee for your Plan. If the Court agrees it will grant the Motion and allow you to buy out. It will take several months for all this to pan out. You only have 10 months to go in your Plan so you may want to weigh this out compared to buying out. As always, your attorney is the best source as to your own personal financial situation.

Your bank will send your title when the vehicle is paid off. If you don't get it within say 6 months after payoff, contact them to send it to you.

If you want to sell your house during your Plan, you also need Trustee permission and you will go through almost the same process as I state above to buy out.

Congrats on doing a good job with your Plan. Believe me, after going through a 5 year Plan (buying out one year early via refinancing) I know how difficult it is.

[Flamingo]

If you filed Ch 13 before Oct 17, 2005, then your Ch 13 case is governed by the old bk law.

Under that law, a 3-year Ch 13 case could request early payoff after two years of on-time payments. A 5-year Ch 13 case can request early payoff also - I just can't recall whether it's after two or three years of on-time payments.

Check with your lawyer - he/she will know if you qualify for an early payoff request and when.

Under the old Law, you had to make on-time payments for 36 months before you could request a buyout in a 5 year Plan. We were under the old law and started buy out procedures about 3 1/2 years into our Plan, finally having settlement just at the 4 year mark (refinancing). It takes a while and is not an overnight procedure.