Early payoff questions

[justbroke]

Well, as far as payments go, it is accurate because that's the system which the Trustee uses to issue checks to creditors. However, the "percentages", number of creditors, and other items are usually not accurate based on the Confirmed Plan. When it came to issuing checks and $$$ and balance, mine was always 100% accurate. Everything else was mostly wrong.

[forgotten]

You can't get an "early" discharge. Additionally, I even had an account in my 13DataCenter that was my 2nd mortgage, it showed 0% and unsecured, but they did in fact disburse funds to them almost every month. Never trust 13datacenter is my rule.

I'm lucky, my trustee seems very picky about making sure 13datacenter is up to date. Everything is and always has been spot on and updated quickly.
I know all the payments to creditors are listed because she always runs my balance down to like $30 about a week after I make a payment.

[enginegirl]

Thanks JB
have a great night! off to bed..been a long day!

[justbroke]

Well, enginegirl, let me be the first to tell you this... don't believe everything you read on the internet. Having wrote that, please believe me that Florida is a deficiency state.

That's why I often show facts and caselaw, or actual State Statutes, to back up what I write...

Florida F.S. 702.10 Order to show cause; entry of final judgment of foreclosure; payment during foreclosure.--
.
.
(the hanging paragraph after paragraph 7)

Any final judgment of foreclosure entered under this subsection is for in rem relief only. Nothing in this subsection shall preclude the entry of a deficiency judgment where otherwise allowed by law.

[enginegirl]

now I am even more confussed!!
JB I found this regarding non recourse vs recourse States
The following is a list of non-recourse and recourse states. Recourse basically means that the lender can come after you (has recourse against you) if your house sold at auction or through a short sale for less than the amount owed the lender. If you borrowed $350,000 to buy your home and it sold at auction for $200,000 there is a deficiency of $150,000. That lender can have recourse against you for that amount depending on your state.

In many states, non-purchase money second mortgages (such as HELOCS) are recourse loans. So, the loan you took out to purchase your house could be non-recourse, but that equity line of credit you used to buy a boat won't be.

Remember that you may be liable for taxes on the deficiency regardless of whether the loan is recourse or non-recourse. Each state has its own variation on the application of its recourse and deficiency statutes. You need to look to your state's statutes and speak to a local attorney for an interpretation.
and it clearly shows FL as being a NON RECOURSE STATE!
Maybe I'm just exhausted from the whole BK... and have forgotten how to read?!?

[justbroke]

Florida is not a non-recourse State.

Florida is a recourse (deficiency) State when it comes to judicial foreclosures. Almost all states that have non-judicial foreclosures are non-deficiency. However, the majority of Florida foreclosures are against Mortgages, are judicial foreclosures, and the lender has the right to "sue" for deficiency after the foreclosure. Florida does, apparently, allow non-judicial foreclosures on Deeds of Trust (different than a mortgage). A Deed of Trust usually contains a Power of Sale clause so the "foreclosure" process is much different. I have never seen an actual "Deed of Trust" with power of sale, as the security instrument for some promissory note... in Florida, but they do exist, apparently.

I usually think like this...

• if your security instrument reads "Mortgage", then your State probably allows only a judicial foreclosure and probably allows deficiency lawsuits.
• if your security instrument reads "Deed of Trust" or "Trust Deed", then your State probably allows a non-judicial foreclosure utilizing a Power of Sale exercised by a Trustee, and probably does not allow deficiency lawsuits.

[enginegirl]

You are one great attorney! I wish more were like you. (And, the poster is from California which is a non-recourse State. Unfortunately, my state (Florida) isn't.)

Hey Justbroke... Just a heads up...Florida is a non- recourse state! http://www.forecloseddreams.com/recourse_states

[LadyInTheRed]

You can't get an "early" discharge. Additionally, I even had an account in my 13DataCenter that was my 2nd mortgage, it showed 0% and unsecured, but they did in fact disburse funds to them almost every month. Never trust 13datacenter is my rule.

Yeah. 13datacenter says I am paying 100% to unsecured. That couldn't be further from the truth!

[justbroke]

Update...I just checked 13datacenter and it matches Pacer. Both show the 2nd as unsecured, not claimed. Does this mean that if all the other debt is paid, I can discharge early or will this start once the other debt is paid?

You can't get an "early" discharge. Additionally, I even had an account in my 13DataCenter that was my 2nd mortgage, it showed 0% and unsecured, but they did in fact disburse funds to them almost every month. Never trust 13datacenter is my rule.

[jennerik]

Update...I just checked 13datacenter and it matches Pacer. Both show the 2nd as unsecured, not claimed. Does this mean that if all the other debt is paid, I can discharge early or will this start once the other debt is paid?

Anyone?

[Pandora]

It makes more sense now. Assuming you are devoting all of your DMI to the plan, the unsecureds will no longer get 100%. If you weren't paying all of your DMI because you didn't need to in order to pay 100%, your payment may need to be increased. That's my understanding of how it would work anyway. An initial plan anticipates a certain percentange to unsecured creditors, but that can change depending on what claims are filed and if the stripped mortgage wasn't taken into account when drafting the plan. I think your plan should have included the fact that the mortgage was being stripped. I don't remember, was your plan already confirmed?

Yep - confirmed over a month ago. All DMI is being devoted down to the pennies and is exactly enough to fund our base plan. 2nd was and is taken into account and noted as such (what I posted yesterday was directly from my judges confirmation order). *sighs*

I dont know any more how our plan works out, my head hurts from trying to figure it out. All I know is that I have 4 unsecured claims; prop. taxes (priority), 2 dr bills and our 2nd mortgage which we stripped. Sole reason for filing was to strip the 2nd. I just cannot see the trustee splitting the remaining 30K (after trustee and lawyer are paid in full) equally between 4 creditors, paying roughly $8K on a $900 property tax bill or the same for the 2K dr bills when I don't owe that much to either of them.

According to our lawyer and the trustee - our plan will not increase above the 36K it's at, trustee isnt requiring any pay raises, tax returns, etc and we've been told we have the option to pay off early if we want to, but its not required. Base plan of 36K is solely non-exempt assets valuations we chose to keep vs. liquidate. ETA: hubby got a new job, making more $, and trustee notified...he did not want any additional $.

I think I need a drink...

[LadyInTheRed]

OMG I think I'm even more confused myself now typing all of that! Does it make more sense to you now or did I confuse you even more? LOL

It makes more sense now. Assuming you are devoting all of your DMI to the plan, the unsecureds will no longer get 100%. If you weren't paying all of your DMI because you didn't need to in order to pay 100%, your payment may need to be increased. That's my understanding of how it would work anyway. An initial plan anticipates a certain percentange to unsecured creditors, but that can change depending on what claims are filed and if the stripped mortgage wasn't taken into account when drafting the plan. I think your plan should have included the fact that the mortgage was being stripped. I don't remember, was your plan already confirmed?

[Pandora]

Lady..

my mistake... you're correct, you did say "pro tanto" I knew it was pro-something-or-another LOL

As to the 2nd being paid at the same rate as the others ... thats impossible to do as everything else IS getting paid in full at 100% of whats owed - but the 2nd will not be at 100%. Maybe this is easier:

36K base plan / over 60 months.

Laywer fees: 2750
trustee % over course of plan: 2500
taxes owed: $900 (its somewhere in the 800's not quite sure so will put 900)
Dr Bills: $2K
2nd mortgage: roughly $80K

If you add all of the above except the 2nd mortgage, its about $8200 or so owed - and then deduct it from my base plan ...that leaves roughly $27-28K for the 2nd, which is not 100% - yet everything else will be paid back at 100%.

So I have 2 different percentages in my plan yet it states "pro rata" meaning they should all get the same amount - right? How on earth would that work? If they paid pro-rata (after attorney / trustee fees) then out of my 4 actual claims, each would get approx. $7600K when I dont owe that much to them.

OMG I think I'm even more confused myself now typing all of that! Does it make more sense to you now or did I confuse you even more? LOL

[LadyInTheRed]

Lady - remember when you said your paperwork stated "pro rata" and I told you that looked familiar? I just pulled ours..and it says (judges order) as follows:

No, I don't remember saying anything about "pro rata." I have mentioned that my confirmation order provides the pay off to unsecured creditor is "pro tanto". But, there is nothing in my confirmation order or lien strip order that says "pro rata." It is possible that I might have said that my second will get a pro rata share of whats left to pay unsecured creditors.

Okay.. so from what I'm reading - its an unsecured even though on PACER its still showing "secured" but also states "Lien Avoided", and its supposed to be paid at the same rate as the other unsecureds..

Right.

but it wont be.

I don't understand why you think that. It will be paid at the same rate as other unsecureds. Oh! I get it! It's because of my question to Des regarding whether the 2nd won't get paid if the claim is not amended. I think paragraph 4.A. of your order negates the need for the bank to amend the claim since the court has already ordered that it is approved as an unsecured claim. I wouldn't worry about it being listed as secured on PACER. The language in the order is what is important, not what somebody did or didn't update on the computer. My order doesn't have the same language as yours. But, because so little will go to my unsecured creditors, it probably isn't worth the cost for the bank to file an amended proof of claim.

[jennerik]

Since it shows unsecured, will it pop up if I try to pay the 13 off early?