Frustrated

[lolly78]

Well tomorrow is my court date to determine whether after making every single payment for 60 months to the tune of over $95,000 whether I can get discharged or whether I have to continue to pay another $11,000+. My attorney emailed me last night with new budgets and schedules I& J indicating we can still pay $1540 a month. He also filed another motion for a hardship discharge. I asked him why would he do that if on the other hand he's saying we can still afford to pay $1500. He said he's just using all possibilities. It just looks like he's contradicting himself to me. Then he says we have time to fine tune the budgets since tomorrow he'll ask for leave to file a memorandum of law supporting the motions. Shouldn't he have already filed this? I told him I just want to go with whatever the judge says tomorrow versus dragging this out any longer. He also indicated that the trustee is not agreement to any of the motions he filed. Wish me luck tomorrow.

[justbroke]

I am wishing you the best outcome tomorrow. Trustees are never really agreeable unless they are getting "more" money.

[LadyInTheRed]

I understand your frustration. I hope your attorney has said somewhere that you have made your required plan payments, paid all priority and secured claims and a large amount to unsecured creditors and should not be denied a discharge because of inconsistencies in the confirmed plan.

I can't speak to your specific issues, but in general it is not unusual to take alternative positions in court pleadings to say our argument is A, but if the court doesn't agree, our argument is B. It's good to have a back up in case you don't win on argument A.

You said in another post that the judge appears to be debtor friendly. That should help. Good luck! I hope that tomorrow we will be celebrating your upcoming discharge.

[lolly78]

Well my attorney called me at 9:30 last night asking for me to give him an opportunity to find case law supporting my case. I said fine, so there is no update today. Motion was continued until June 2nd. In other news, my husband switched shifts which will pay considerably more, so if we have to pay the 11K, at least it will be a little easier to do so. Thanks JB and LITR for the well wishes!!

[lolly78]

So my hearing was today and I still don't have a resolution. It was continued AGAIN until June 30th now. My attorney got an epiphany last night that we shouldn't need to modify the plan at all because special paragraph G of the confirmed plan overrides the percentage terms of the plan and should control the plan and provides for the plan payment to be based simply on the difference between income and expenses. Maybe I'm missing something, but I don't see where paragraph G says all that. It says:

2. Based upon the decision in Re Lanning, the Debtors plan is based upon the differential between I and J since the income set forth in Form 22 is not representative of the income of the Debtor.

He said the the judge wants him to file a written memorandum. Does anyone agree with his argument? I do hope it works, I just hate we have to wait another month to find out.

[justbroke]

It appears that your District, like some in Florida, use the "arbitrary" numbers that are rendered by the Means Test (Form B22). In some cases, the Means Test looks back at the last six months prior to filing and is unrealistic because the numbers may include seasonal income, one-time bonuses, a job that no longer exists, and other strange artifacts by its (Mean Test's) narrow scope.

Your attorney is arguing that the Supreme Court in Lanning says that the Court should look beyond the Means Test in these cases where the Means Test is not representative of the "forward looking" approach from the Lanning Court.

It's strange that your court needs to be briefed on this.

Only Antonio Scalia dissented, and this was an 8-1 U.S. Supreme Court decision. The majority option ends with:

Consistent with the text of §1325 and pre-BAPCPA practice, we hold that when a bankruptcy court calculates a debtor’s projected disposable income, the court may account for changes in the debtor’s income or expenses that are known or virtually certain at the time of confirmation.

[lolly78]

Well folks, I'm still frustrated! Actually having a major meltdown as I type and just need to vent. My court date was yesterday. My attorney emails me after and just says that the judge didn't grant our motion but he didn't deny it and that he'd let me know what's going on later. I have no idea what this means. I checked pacer and all that I see is that it's continued again. I checked the court calendar and we're not on there for the next two weeks, so this will go past my delivery date.

Prior to this court date, the attorney filed a motion which basically included all our new expenses, and indicated that we'd made every single payment and should get a discharge. The trustee filed a response that made us sound like total criminals. That our income increased (which I e-mailed my attorney about and he said nothing) and that our "new" expenses (associated mainly with my 2 year old) were unnecessary! My son is 2 and doesn't talk so he's in early intervention and speech therapy. How dare they say such a thing!!! They said we were manipulating the bankruptcy code and all other kinds of things. 9 pages, compared to my attorney's 2 pages so I'm sure you know who's was more convincing!

I just feel like folks file chapter 7 and get a clean slate after 6 months. Here we are 5 years and 6 months later, $95,000 and are still waddling in chapter 13 misery. My 2002 car wouldn't start this morning, thankfully I have a flexible job where I can work from home. We work hard everyday, especially my husband. Sometimes it seems like the folks who do nothing get all the benefits and we get nothing for working so hard! I almost feel like quitting so I can get my retirement money out pay this off and just be done with this once and for all...or win the lottery.

[justbroke]

Don't read too much into anything written in the Trustee's opposition to your Motion to Modify, and don't read too much into the hearing being continued. I had a Motion to Modify Confirmed Plan hearing continued for 8 months before it was done. Much of the waiting was on the Trustee to look at some things, and then the Trustee had used the "wrong" numbers. (I actually was arguing with the Trustee himself that they calculated the remaining payments incorrectly, and that caused another continuance.)

The 9 pages is not "convincing" at all. The Trustee's job is to object and they must have actual reasons. Alas, it's not until the hearing and evidence is presented which shows us what is "more" compelling. It was probably continued because the Trustee now heard additional information (from your attorney at a hearing before the judge) and it's likely that the Trustee was ill-prepared and asked for a continuance.

I don't say this patronizingly, but please relax. This is a process. The process is working... albeit slower than you may expect it to work, need it to work, or desire it to work. I'll say that your attorney is competent and it's likely that your attorney and the Trustee (or the Trustee's attorney) either reach an agreement (which is typically the case!) or go back before the judge and let the judge decide.

[lolly78]

Well I heard back from the attorney. The judge has indicated that I need to pay back the full 79%, so another $11,000+. I'll be in this thing for 6 years instead of 5. The hearing is continued until October, at which time they'll check our payback progress.

So most likely we'll be broke until February. It sounds like they'll accept whatever payment we send. Our attorney suggested pulling money from our 401K, but we already have loans out so we can't do that.

My husband is going to take overtime when he can get it, so that should help. I'm debating whether to sell my car. I can probably get around $6000 for it with a little work. I'll be on 100% paid maternity leave after next week. I'll have more money in my check since I don't have to pay for my train pass, parking etc.

I may get pushback on this one but I changed my withholding to exempt which is $800 a month in taxes they won't take out. I'll just deal with the IRS next year.

It's really unfortunate because we planned this baby around the fact that our 5 year plan would be over and discharged by now.

So much for our fresh financial start.

[justbroke]

Yes, certainly frustrating. It's unfortunate that the Trustee didn't really do their job reviewing your tax returns. In our District, they look at them and typically decide whether to modify your payments if there's some sort of "significant" increase in income. It reads as though your income increased over the years (maybe not just 1 year, but over the 4-5 years) and the Trustee thinks that you could have paid more.

I really feel bad for you. It's so disheartening to be near the finish line and to have the Trustee declare that you haven't paid enough. This doesn't happen that often, but when it does it makes me really sad that the system is still broken (if you ask me).

[sophieanne]

Lolly, I'm so sorry for what's happening; it really doesn't seem fair.
Justbroke - if they were sending in their tax returns and the trustee didn't do anything at the time, couldn't there be another appeal made to the judge. It doesn't seem right that lolly and family are paying for the negligence of the trustee. Is there anyone higher than the judge one could go to?? (Just cuiious).

[justbroke]

I don't practice law and I don't know what one would achieve by saying the Trustee made an error. You can always fight it, ask for a reconsideration, file an appeal... all costs $$$ and that cost would be borne by the debtor. I can't even second guess the attorney who seems to have fought and brought a pair of defenses to an increase in the plan base. I also don't know what basis the Judge gave for ruling with the Trustee.

[switch625]

I looked at your earlier posts (which had figures) and what I think is your district's Ch 13 "Model" plan and if that is what you needed to use, it differs from the standard (national) form for the Ch 13 plan (which is what is used in my district).Ii appears IMO the form you needed to use unnecessarily complicated compared to the standard 13 plan form (not the first government document from Chicago I've seen that made my eyes roll BTW). The key is that you are beholden to that 79% payback of the GUCs. I have to say I'm confused by Section H and the concept of"initial plan term", especially after reading Section H. My form only specifies a minimum percentage payback of GUCs as pro rata, so unsecureds get whatever is left after Trustee payment, secureds and the priority payments. Without knowing more how the "initial plan term" and the allowable adjustment works, at first glance it looks to me that either a feasible plan was not prepared in the first place or your attorney or trustee should have monitored your case better during the 60 months. I'm going to guess that your paying 11K more is not so much an issue of having increased disposable income over the life of your plan, that needed to go into your plan, but meeting 79% payback as required in your plan (based on the disposable income you had when the plan was confirmed), plus paying the secureds (where they paid first?)

[lolly78]

We were never required to send in tax returns. We owed the IRS at the time we filed. All secured creditors were paid the first year of our plan. We paid $1490 the first 4 years then $1990 the last year. The step-up was due to me paying off my car.

There were 3 years during the plan I didn't get a raise at all, but once I did I let the attorney know. We also had added expenses because I had a baby in 2013. We also had our mortgage modified which was approved by the court. Trustee received a copy and never said anything, but of course now they bring it up. The thing is it went up over $300 before it went back down and it took many months for the modification to take effect.

Were there times we could have paid more? Sure, but I didn't realize we had to. I just assumed we'd be done after 5 years of making our payments.

Even the trustee Statement I received twice a year was misleading. At the very top it said total minimum payment $95,000. It breaks down all the claims but doesn't give you a total of what the 79% is.