Just keeps getting worse

[onejeg]

Just need some input - PLEASE!!

So I had my 341 hearing 4/7 and conf was sch for 5/13. Well my lawyer said that they would push that for 30 more days since they fixed what was needed. Well as everyone probably knows paralegals pretty much do everything (well at least the office I am going thru) Well I was first told my payment was $365 then after they made needed corrections my payment went to $495. Even though the jump I thought no big deal. Well after 2 months of trying to get in touch with someone at the office I finally did. First off the paralegal that handles BKs no longer works there, Second versus it being a 3 yr plan it is now 5, third my payment went from $495 to $925. So with the ext in years then the big jump in payment I was then told my confirmation is this upcoming Monday. Last time I had over a month notice on the first conf hearing and not less then a week. Stressed out to the max!!!

So my questions are:

Do I need to be at the conf hearing (cant miss work)
I can't afford $925 a month is there anything I can do? - still have mortgage, cars, family, etc
Is this common for lawyers to let me sit around for 2 months and versus reaching out to me I had to keep calling and calling

I just dont know what to do

[rrockinggramma]

I would demand an accounting of the 925 payment and what caused it to climb so high. If you did go to the confirmation hearing, you should be given a chance to have this all explained to you. A chapter 13 is all about funding so if you had mortgage arrears etc maybe those claims came in higher.

[Flamingo]

None of us think we can afford to get through a Chapter 13 but there is a reason for the payment to be the amount it is and they would not approve it if they did not think you could not pay it and successfully complete your Chapter 13. It's obvious something occurred to make your play payment higher so contact your attorney directly and obtain a breakdown as to the payment. Since it changed a good bit, you need a complete explanation. Call your attorney's assistant and advise him/her that you have a hearing coming up next week and need to know whether or not you need to be there (I don't think you do) and that your payment amount and length changed dramatically and you are entitled to an explanation which you have not received and you would like to know what is going on. If necessary, show up there in person (attorney's office).

[liz417]

Hi there Onejeg,

I would call/email your attorney and demand an explantation! If s/he doesn't return you call...go down there and wait until he will see you! This is your life/your payment and this is very important because you want to be sucessful in you ch 13 repayment plan.

Good Luck to you.

[BigJohn]

Do you have car(s) that have been put in the plan?

[onejeg]

more info

Yes there is a car included in that. guess I will need to go down there because I called today and got nothing. Its just hard to believe the payment first started at $365 and now its $925. With that payment I will actually need to get a part time job....

[BigJohn]

Is the car payment $925 - $365 ($560)?

[lrprn]

Ch 13 filers do not attend their confirmation hearing, but it isn't forbidden. Some courts make Ch 13 confirmations a "group" process with only the more complicated cases being heard individually in front of the bk judge.

Your confirmation hearing is NOT the place to publicly find out why your payment is larger than expected - the judge very likely won't allow the disruption to the bk court proceedings. But you may be able to catch your lawyer there *before* the hearing (he or another lawyer from the office must be there) and ask then what happened with the payment.

Did you sign your Ch 13 forms before they were filled out and you saw the proposed monthly payment?

[BKParalegal]

Here are some common reasons why a Chapter 13 payment would go up.

Arrears on Secured debt( Home, Car) were understated

IRS Claim understated

Initial cramdown on a vehicle was not accepted and worthless attorney couldn't negotiate a good value

Your expenses listed in Schedule J or the means test were not allowed or were reduced( this would be due to your attorney not checking his figures or lack of a backbone)

You or your attorney understated your family income

A competent attorney can sit you down and show you exactly where the money is going.

Good Luck

[onejeg]

The only papers I signed where the org payment of $365. Since then I havent signed any other papers. When I spoke to the new paralegal that handles BK they were talking to me like I had already knew about all the changes. I had to tell him I hadnt spoken to anyone since May. So due to such a short notice I cant get time off of work so I dont need to go to the conf hearing if it still occurs right?

Answer the question about the car payment was $615 a month

The paralegal said they looked at the equity of my home and that made the payment higher. Crazy thing is they said that I have $37K in equity in 2 years of leaving in my home. I know based off my taxes for the house it has maybe $10K in equity so Im not sure where they are getting that number

[onejeg]

answer

no the only paper I signed was the org $365 payment. I hadnt heard about the $925 payment until yesterday. The last time I had spoke to someone from that office was in May, it was the old paralegal that was working my case and she had told me that we should be good with the $495 payment.

When I spoke with the new guy he acted as if I new the term was ext and the payment was increased....of course I corrected him and told his this is the first I heard.

Answer to above. The car included had a payment of $650 a month

one thing the new guy told me was that my payment went up since I have 37K in equity in my house...not sure how they figure that because I know after 2 years of owning the house the market going down the tube that there is no way its jumped up that high

So from the sounds of it I dont need to go to the conf hearing right? I checked and I am unable to get the time off (call center job)

[BKParalegal]

I would check the numbers on the house. It is not the most accurate but check Zillow.com and also go to your counties tax assessor website and look up the tax value. Compare those amounts to what your payoff is on the house. This amount should include the amount you owe on the loan right now and any arrears.

What your attorney's office is not telling you is they screwed up on the value of your house by not verifying it, had no backbone to argue with the Trustee, and since you are over the exemption amount in your state, the trustee is making you pay that extra amount to your unsecured creditors.

It sounds like your attorney didn't successfully argue administrative costs to sell your home. For Example, lets say the house is worth $125,000 and you owe $100,000. Technically there is $25k in equity, but in reality you have to sell that home and pay commissions and closing costs. That usually runs 7% to 9% so in actuality the math is:
$125,000 value $11,250 in closing costs, $100,000 payoff mortgage- Net Equity $13,750.

In short, your lawyer sucks.

Good Luck

[onejeg]

yeah zillow.com showed about 20K and based on my tax assesment that I recvd for year end 07 my house had a little over 10K in equity. Also the house isnt even included in the BK I am keeping it. How can they add the equity when my credit is now crap and I cant even touch it. So at this point do I just need to suck it up?

Is there any way to switch lawyers or am I to far along

[BKParalegal]

The fact that the house isn't in the BK is irrelevant. The way any asset is looked at in bankruptcy, is there is an exemption amount for your assets, and if you go over that exemption amount, than according the code, that excess should be reasonably paid to your creditors, either thru selling the asset, and whatever is left after you keep the exemption amount goes to them or you keep the asset and pay it through a payment plan( Chapter 13).

Again I would go in to your attorney's office and have them break it down where your money is going to, if it is due to the excess equity in the house, then ask him/her when an appraisal was done ( and unless you had it done or approved it I guarantee it wasn't done) and how did they get the value.

Good Luck

[cwillie]

Call a local real estate agent and ask to have a comparative market analysis (CMA) done on your home. That's what we had to do. It's free, at least in my area and should only take a couple of days to get.