Discharge from 13 before term completed

[lg11105]

Do we have to be in plan for complete term(3 or 5yrs) or can we pay the full plan amount before the plan period and get discharge.
For example, if the monthly plan payment is $100 and unsecrued claims are say $50,000, can we just pay $6000(60X100) and get discharged.

[TheBajan]

What you are talking about is 'buying out' your plan. I'm sure someone will correct me if I'm wrong but my understanding is that this was something that could be done prior to the 2005 change in BK laws. However, unless you are an under the medium filer in a 3 year plan, I don't believe that's possible under the current laws. Let's say your plan payment is $100 for 5 years and you come into a little cash and decide to just pay the $6000 like your talking about. The trustee will gladly take that money and apply it to the $50,000 you have in claims. Then he/she will continue to take your $100 a month for the remainder of your five years.

Hope that helps,

The Bajan

[IM2Stressed]

If you are in a 100% payback, then you can do the "buy out". Otherwise, poster TheBajan is correct.

[dmc-2008]

What if you figure out what 100%is and pay it back? Or what if you win the lottery can you convert to a 7, figure out the numbers and pay it back. Cause I gonna win, lol

[Floridagail]

Can a 13 plan be for such a small amount 100.00, what about the attorney and court fees? My Niece is in a 13 Florida , and she claims she can pay if off after 24 months, she is not a 100%payback.

[TheBajan]

Can a 13 plan be for such a small amount 100.00, what about the attorney and court fees? My Niece is in a 13 Florida , and she claims she can pay if off after 24 months, she is not a 100%payback.

Based on other posts, I don't think the OP is actually in a confirmed plan yet. I think he/she simply used the $100 and $50k as hypothetical numbers. I'd be interested to know more about your niece's case. I've never heard of that being allowed even though this question has been asked before on this forum. Perhaps there is some special circumstance in her case?? I'm truly interested in knowing.

[TheBajan]

My Niece is in a 13 Florida , and she claims she can pay if off after 24 months, she is not a 100%payback.

I forgot to ask, is she in a 3 year plan? Is she an under the medium filer? If so then that would explain why she can buy out early.

[Floridagail]

I forgot to ask, is she in a 3 year plan? Is she an under the medium filer? If so then that would explain why she can buy out early.

NO she is over medium , 70K year, 2 kids shared custody, she rents and has a horse, pets, so I was rather shocked that she only has small plan amount for 5 yrs with zero payback to unsecured. I will check with her Mom again tonight on the details, Her Mom told me that she told her she could pay off after 24 months.

[LadyInTheRed]

What if you figure out what 100%is and pay it back? Or what if you win the lottery can you convert to a 7, figure out the numbers and pay it back. Cause I gonna win, lol

LOL! You wouldn't need to convert. When you win, call the trustee, tell him you won the lottery and want to know how much you need to send him to complete your plan.

Good luck!

[LadyInTheRed]

NO she is over medium , 70K year, 2 kids shared custody, she rents and has a horse, pets, so I was rather shocked that she only has small plan amount for 5 yrs with zero payback to unsecured. I will check with her Mom again tonight on the details, Her Mom told me that she told her she could pay off after 24 months.

Either there are missing details or your neice is misinformed. The only way to finish a Chap 13 in 24 months is to pay 100% of unsecured claims. Now, if her sole reason to file was to save a house and the mortgage arrears is paid off after 24 months, she could stop making payments and let her case be dismissed. But, she'd still have the unsecured debt to deal with. Better to stay in the plan and get a discharge of the debt. If her 60 month plan pays zero percent to unsecured creditors, she probably needs the entire 60 months to pay the arrears.

ETA: It is possible to have a $100 plan payment, but I doubt it's very common. Somebody with such a low payment probably qualifies for a Chap 7, but chose a Chap 13 for a lien strip, to pay arrears on secured debt, or to keep non-exempt assets. Or they have a 401K loan that can't be deducted on the Chap 7 means test and were forced into a Chap 13 where they could include the 401K loan payment as an expenses.

[Floridagail]

I just pulled Pacer and found her case, It was 100.00 month for 60 months. unsecured creditors(she owed 90K) get 3550 and rest to be paid to attorney and trustee. She in my opinion should of been a 7. She filed the week b4 her wedding, I cannot think of any reason, she was not behind on car, only her credit cards. I will follow up and see if she gets discharged early. She claims she can after 24 months.

[HHM]

Not aware of how she could, there are really only 2 ways to do this.
1. hardship discharge. (rare...usually the courts and trustee prefer conversion to chap 7)
2. Hardly any creditors filed a proof of claim.

But more power to her, can't wait to see how this plays out.

[Floridagail]

Me too, August will be 24 months. So I will follow her case and see.

[dmc-2008]

Thx Lady! I guess I better go buy a ticket if I plan on being the next big winner! :-)

[Floridagail]

I still cannot believe she would be put in a plan for 100 a month. ( When my sister told me that, I figured she misunderstood. She is afraid to work OT, and her new husband is a loser in my opinion. I know she will make it thru the plan. Cannot help from thinking her attorney could of got her in a 7. Just venting I guess.