Chapter 13 Issues, Really need help

[msawyer1974]

Ok, me and my wife are almost finished with our long 5 year Chapter 13. We have like 7 payments left to go. To give you an idea to or pre-file status it is; we filed and were forced to pay 100% to owed; it was a five year plan; it was mainly CC bills, medical bills, etc. The house and at the time car was not under the filing. So here is my issue...

Shortly after filing the Chapter 13, like 6 months into it, my wife lost her job (closed down), so her income was cut down. about 3 months into her unemployment we could not keep up on the new car payments of $660 per month, so I asked my lawyer could I surrender the vehicle, he said yes, I also ask the lawyer if by doing so, would/could they come after me, during or after the Chapter 13, he said that you can not aquire new debt and so my lawyer asst me in surrendering the vehicle. Another 3 months went by and my wife was able to get another job, we were getting back on track, but we noticed that the car company sold the vehicle and the difference appeared on the monthly trustee statement, but that no moneys were going towards it. So after seeing it on the statement for a couple of months, I called the lawyer and ask him about it and he informed me that its listed, but we don't pay on it. Keep in mind that I also called the trustee on it as well, and the same answer came to me.

Here is the best part. Like I said we are like 6 months left on the plan, so about 3 months ago, I get a letter from the trustee that states that we have to pay on the vehicle and that we owe about $13000 on it. So with my lawyer request I supplied our paystubs and sent them to him for review and some chapter 13 thingie. Well I get a call from my lawyer that states that the trustee is raising my plan payments to $1360 per month from $430, based on our income, but in realness we can not afford this new payment. By making this new payment plus the current bills, we would be left with less than $500 per month to support a family of 5.

So this is my biggest question...
The vehicle has been listed on the statements since like month 12 into the chapter 13, why then did they not make me pay it then where the payment would have only went up $260 more per month, verse wait till I had 6 months left to pay off and not the payment is $900+ more per month. Is there any way I can fight this on this ground that it has been there since the 12 month make? Can I fight my lawyer, whom doesn't seem to be doing much to help me on this? Can I fight the trustee for not catching and doing something about it, when it first appeared? I'd really hate to back out now, but what if I am forced to, cause, I can't afford that new payment?

Any help on this would be great... Or just point me in the right direction.

Mike

[despritfreya]

I don't have a specific answer to your question. Just an observation. I believe this is the fault of the lawyer. If this was a vehicle you had before you filed and your original Plan said you were either paying it through the Trustee as a secured claim or paying it directly, once you decided to surrender, a Modified Plan should have been filed. If, due to the non-exempt equity in property or your ability to pay, you were required to pay 100% of all allowed claims, the Modified Plan should not have been approved until the vehicle lender amended its claim to show the unsecured deficiency balance.

I think the question now becomes: Can you modify the Plan to provide for less than 100% of all allowed claims? I think you would need to do this if there is currently an Order Confirming that states all allowed claims shall be paid in full.

Des.

[msawyer1974]

This was a vehicle I had before we filed and we paid on it outside of the chapter 13. After my wife lost her job, we couldn't afford it anymore and the lawyer advised us to surrender it. What I don't understand is that the lawyer nor trustee never filed to modify the plan. About 2-3 months after the surrender of the vehicle, the $13,000+ deficiency started to appear on the trustee reports, but they never did anything about it, that is until now, when I have 6 months left to go on my 5 years and they now have jacked my payment up from $430 to $1315...

We can't afford this. So what chooses do I have to fight this? To me I believe the lawyer need to fix this issue.

[despritfreya]

We can't afford this. So what chooses do I have to fight this? To me I believe the lawyer need to fix this issue.

Again, I do not have any real answers. I do believe you need to sit down with the attny and go over what has transpired. Is a conversion in the cards? What assets would you lose if you convert? Do you even "qualify" for a 7? If not a 7 can you modify the Plan now to provide less than 100%? These are all questions to ask the attny.

Des.

[momofthree]

Increasing your payment by $900/mo still won't pay 100% of your claim. It only covers $5400 rather than the full $13k. It sounds like they re-calculated your dmi based on your total income, with your wife now working. It's possible that they never brought it up originally because your tax returns showed your decrease in income and they knew they had nothing to go after, but with your wife working again, they're trying to get back to 100% of dmi. Can they provide you with the copies of I/J calculations that they used? Maybe they didn't calculate the income correctly, or left off deductions like medical, etc. Also, if you were used to spending above IRS standards in certain areas, they would have cut those back. I know how easy it is to get extra income and it's suddenly gone each month, especially after pinching pennies during a period of unemployment. You really need to find out how they figured out your new payment. Are you or your wife paid bi-weekly? That can also throw a wrench into the equation. Contacting your lawyer is your first step.

[msawyer1974]

Me and my wife were working at the time of going chapter 13. Based on our combine income they figured us to pay back 100% against owed. She didn't lose her job till about 4 months into it. I just set up another appt to see the lawyer this week. My main question to him was how could this go 48 months over looked by the trustee office. He told me that the finance company could have waited that long to amend it. So I then asked him ok they waited a year to amend it, which would have still brought us to 36 months of increased payments ($360+ per month increase), at 48 months it would have increased only ($260+ per month). What upsets me is that they wait till I have 8 months to go and start to amend this and after 2 months of amend, my payment goes from $430 per month to $1315 per month. There has to be protection against this late addition. When I first talk to my lawyer about this surrender, he instructed me that they couldn't come back on me, since I was already paying 100% to plan.

So if my lawyer can't/willn't help me on this, then what should I do. Can I go after the trustee for not following this at day one? Can I sue my lawyer for misrepresentation? Can I go after the vehicle financial company? Do you mean to tell me that at any point during the plan, a company you owe money to can come at you for payment?

Last question is: What would happen if at some point I can pay this new plan rate and am forced to drop out of the bankruptcy. Can the companies that were paid off come after me? What about the companies I still owe on? What about all the money I paid the trustee?

[jcj112562]

As soon as *you* surrendered the auto, *you* changed the parameters under which the Plan was approved. If your attorney did not amend the Plan at that point, you have no real leg to stand on. If the trustee calculates that you have DMI to pay the revised payment, then you get to do 8 months of scrimping to pay it. Not exactly what you want to hear, butthat is how I read it. The money they want you to pay was always owed, but would have been taken care of in the Plan had you not changed the parameters by surrendering the vehicle. The trustee is not at fault, your attorney did not do what should have been done, but in the final analysis, it is *your* fault that you did not follow up vigorously, you were just happily paying the reduced plan payment due to the wife not working. Now that enjoyment has come home to roost. I am not trying to be mean, just telling it like it looks to an outside, unbiased observer.

John

[msawyer1974]

You are correct and I thank you for calling the duck, the duck. Now 2 months ago like I said the lawyer wanted to see our paystubs and a list of what we pay every month and I supplied, but then they come back with a new payment from $430 to $1315. Truth is I can afford this and by doing so will leave my family of five with cent more than $600 per month to cover personal expenses.

Last questions: (these are the once I really need answered) - we have a mortgage, didn't know if this would help on the answers.
So what happens if we can not continue to finish with the chapter 13?
What happens to the creditors we have finished paying on?
What happens to the once we still owe on?

I want to thank everyone for providing me with answers to questions that you would need more hard details to truely give a full meaning.