Trustee's "Application for Compensation"

[Tom_Mi]

Hi,
We're an asset case, having turned in some apartment buildings.
Discharge was April '09.

Trustee complained about my wife's exemptions, and we settled a
month ago for 2,400. I sent the money 3 weeks ago.

Case still open....!

So, yesterday the trustee files "application for compensation" and is requesting about 1,100 for her legal efforts...which Is ok, as long as I'm not paying MORE.


My Questions:

-This 1,100 comes out of the 2400 I already paid to the estate, right?
-Can I assume they'll close the case soon after the trustee collects this 1,100?

Thx!

[justbroke]

-This 1,100 comes out of the 2400 I already paid to the estate, right?
-Can I assume they'll close the case soon after the trustee collects this 1,100?

This money comes out of whatever money is in the Estate. This could be cash you paid into it, or proceeds from the sale of (non-exampe) assets. The Trustee, as well as any attorney, must ask the court for permission to be paid from the Estate. This is known as the Application for Fees, as you mention.

[Tom_Mi]

cool. Maybe this means she's done doing billable work on my case and will close it.

[want2save]

Have the apt building been sold and the proceeds distributed to creditors? I would think the BK case would remain open until the report of distribution is filed. Just Broke, please chime in and correct me if needed!

[justbroke]

You're correct. The Trustee still may have more "work" to do. They can file an application for fees whenever they need money, and have performed the work. If the buildings aren't yet sold, expect another application for fees. Once the estate is fully administered, the Trustee will write a final report which details the distributions, exemptions, and other general accounting of the case. At that point the Trustee will ask to be relieved from duty.

[Tom_Mi]

uh oh. what about my house? (I'm riding thru).

Is she going to keep the case open until I sell or foreclose?

[justbroke]

uh oh. what about my house? (I'm riding thru).

Is she going to keep the case open until I sell or foreclose?

No. This is only in relation to assets that the Trustee is administering in an asset case. This is why asset cases stay open much longer than non-asset cases.

[catleg]

source

[want2save]

JustBroke,

I'm in OR. We don't reaffirm on mortgages. Mine is current, I am keeping the house and my exemption covers the equity. Will my case close when the vehicles I'm surrendering sell and the report of distribution is made? I am never selling my house, instead I am getting a Reverse Mortgage as soon as the case closes. My attorney says the assets that are exempt will be returned to me at that time. I don't see how my home can hold up closing, can you?

[justbroke]

Will my case close when the vehicles I'm surrendering sell and the report of distribution is made?

Surrendering your vehicles has nothing to do with your case closing or Discharge. It is up to the individual lender to come and repossess, foreclose upon, or do something else to recover the collateral.

My attorney says the assets that are exempt will be returned to me at that time. I don't see how my home can hold up closing, can you?

If you are a no-asset case, there is (generally) nothing that would stop your case from closing as soon as discharged or shortly thereafter. The only time closing is spread pretty far apart from the discharge, is when there are assets to be administered in the case. By "assets to be administered in the case", I mean those assets that were non-exempt and that the Trustee has not abandoned and has chosen to liquidate for the benefit of the Estate.

[want2save]

JustBroke, I am sorry I did not explainmore clearly. My motorhome and car are paid for and the Trustee is taking to sell on behalf of creditors. I bought back my van, in fact I just mailed the money yesterday. My 60 days are up on 9/18. So far there has been no conversation about the TT taking the MH and the car, but this is an asset case and the value is about $30,000 and so I'll sure I'll hear.

[justbroke]

JustBroke, I am sorry I did not explainmore clearly. My motorhome and car are paid for and the Trustee is taking to sell on behalf of creditors. I bought back my van, in fact I just mailed the money yesterday. My 60 days are up on 9/18. So far there has been no conversation about the TT taking the MH and the car, but this is an asset case and the value is about $30,000 and so I'll sure I'll hear.

yes, I'm sure you'll hear. But again, this won't affect your discharge which is what you want more than anything. The rest is just paperwork (administrative), so the close, while necessary, can drag on.

[want2save]

Thanks JustBroke. The reason I care so much about the closing is because I need to liquidate my IRAS to pay off my HELOC so that I will qualify for a Reverse Mrtg. I no longer can afford a mortgage payment, and at 68, am not able to find employment here in Southern OR. With no mortgage I will be fine on my social security and need to do this as soon as possible. My attorney tells me I cannot use my IRAS until the TT files the report of distribution and returns the exempt assets to me, otherwise, the IRAS will become non exempt. Does this sound right?

[justbroke]

My attorney tells me I cannot use my IRAS until the TT files the report of distribution and returns the exempt assets to me, otherwise, the IRAS will become non exempt. Does this sound right?

Your attorney is worried about converting an exempt asset (IRA) into a non-exempt asset (cash). I would probably side with him being cautious and waiting until the Trustee is done. I don't know if that means discharge or close, but at least until you and your lawyer know that the Trustee isn't interested in any other property.

[want2save]

My understanding is that discharge involves ONLY your debt, which is the concern of most chapter 7 filers. I did not have the income tofile a 13,. So, as an asset case, I have to be concerned with closing which will release my exempt assets. Or, so says my attorney here in OR.