Question-Old Law Chapter 13 Bankruptcy

[$$only4ever]

I am in a Chapter 13-Old Law and have reached the 36 month mark of my 60 month plan. I have a question. I have been making my car payments outside of plan. I have been sending extra $$ with the past several payments and am now in a position to pay it off. The balance is approximately $3,500. Since the trustee cannot look at additional disposable income anymore, would it be okay to pay it off, or would it raise red flags with the trustee? The trustee and I have a great relationship.....he doesn't bother me and I make my payment every month. I just don't want to do anything that will place me in the line of fire. Thanks.

[Minnymouth]

You didn't say whether you were in a 100% payback plan or not in your Chapter 13.

Personally I would not pay off the auto in full unless I was in a 100% payback Chapter 13.....

Paying off a creditor very, very early tells the Trustee that you have some disposable cash around.

If your Chapter 13 payment plan is not for 100% the Trustee could say that you have extra money that you can pay more back to your creditors.

In a Chapter 13 you must report any "windfalls of cash, lottery, inheritances, etc"..... large increases in income. Usually the Trustee will tap into this to pay your creditors unless your payback is ALREADY at 100%.

I know after the 36 month period you can often refinance and pay in full the balance on your payment plan.

Others here on the forum have "paid off early" in Chapter 13's, maybe they will offer some more input on the subject.

[Flamingo]

I am old law. In order to do anything financial-wise during anytime during your Plan, even after 36 months (we were 60 months and bought out early at 48), you need Trustee permission since you and your Plan are still under his/her control. You will need to contact your attorney first and pass this by him/her to see what he/she has to say and if it is actually doable. If it is, the attorney will contact the Trustee for whatever needs to be done for you to pay it off.

[$$only4ever]

Thanks for the responses. I think that I will just lay low and continue paying a few bucks extra each month and then it will be paid off earlier than planned. At this stage of the game, I do not want to become the trustee's poster child.