Trustee Is Doubling Our Payment Effective September2020

[Barbisi]

I am in shock and beyond disbelief at the email we just received from our attorney this morning - after reviewing last years' tax returns, the trustee is raising, effectively doubling our payment by $600 per month beginning next month!
Our lawyer said that in the thirty years he has practiced law and in the years he has dealt with this particular trustee , he has never seen a payment modification done with out first requesting that a new I&J done. Instead ,he has went ahead with out warning and arbitrarily doubled the payment to more than $1200!
The lawyer is going to fight it, but I am sure the trustee is going to raise the payment- the question is by how much?

[justbroke]

That's just crazy Barbisi. A report on a survey of Trustees, several years back, revealed that they normally don't modify plans spontaneously and fewer than 10% of cases ever have a plan modification. It's usually only where the difference in income is 10% or more (at least according to that survey of Chapter 13 Trustees).

[Barbisi]

Thanks for replying jb!
Yes, my husband did receive a bump of more than 10% (on paper) last year at the new job but our expenses have increased too, by more than $400+
And I am facing a serious surgery in about two month's time - I don't see how we are going to be able to come up with $600 more each month!
The lawyer seemed to be upset that he was never contacted prior to this mod being done ! He just looked at the July pay stub and compared it to my husband's starting salary in 2017 decided we have more than $600 more dollars of extra DMI each month.
The cost of living is going up and this is the age of Covid-19 -how heartless can these people be?

[Barbisi]

UPDATE: according to my husband's latest calculations, and what IRS permits in expenses, our allowable expenses have increased by more than $600+.
We are prepared to go to court and testify before the judge that these are our expenses.
I think the lawyer can file some kind of emergency petition to force the court to review our I &J to show that even though my husband's take home pay has increased , so have our expenses, including medical!
Has any one on these forums faced something like this and how did you handle it?
I think somebody doesn't want us to successfully finish this BK13!!!!!

[justbroke]

From the two Chapter 13 Trustees that I have met, they generally want the debtor to be successful. As my first one put it "I'm not successful unless you're successful" which makes sense. (Translated, I don't make money unless you keep paying money by staying in the plan.) I don't know why your particular Trustee is so difficult.

The Trustee should need to file a Motion to Modify Confirmed Plan in order to raise your monthly payment. They can't do it arbitrarily when there is a confirmed plan in place. Your attorney should object to the Motion to Modify Confirmed Plan and go to bat for you.

[Barbisi]

Thanks jb!
I always thought this particular trustee was difficult LOL!
We have sent a new I &J form along all the "hits" from this year (Taxes, escrow shortage ,a half dozen car repairs,etc.) on to our attorney. He indicated he would contact us after looking over the form. So we shall see!

[Carmella]

That's awful. I am glad your attorney is right on it! Our attorney made a comment when we started our plan and the trustee asked for $200 more a month due to a miscalculation on our part (no way intentional), he said that the trustee will try to get more money. Since we are in 100% plan there was no problem in keeping that $200 and it's not like we have much wiggle room anyway. I still wonder if our calculations were off to start with, but then again they did not think we needed any money to help support our young adult daughter who was starting a $10 an hour internship and literally graduated from college the weekend/days before our 341 meeting.

Try not to worry too much. It is such an unusual thing, your attorney should have a strong case at keeping the payment the same amount.

This also reminds me that I never sent our tax paperwork to our attorney! I think in our case the attorney keeps the copies, but it's not not forwarded to the trustee.

[flashoflight]

Your trustee sounds like a penny pincher who would bend down and pick up a penny even if it hurts to bend down. The problem with a trustee bending down to pick up the penny is that debtor's counsel will make it harder with an increased schedule J to eat up a good chunk of the increase just due to inflation.

[sophieanne]

Good luck Barbisi - your trustee sounds horrible. I think someone's just trying to test you. I agree with JB's trustee - they should want you to succeed...you don't win..they don't get paid. Sounds like you're armed and ready to go. Will be crossing my fingers for you.

[Barbisi]

Hey, sophieanne who's testing us - God, the devil or the court?

[Barbisi]

Thank you all for your supportive replies!
We are in contact with our lawyer as I write this.
Although I am not optimistic about the outcome, I think a compromise can hopefully be reached - for example the newer car will be paid off in December. So instead of just taking $75 (per the original confirmation) he could take the entire $200 . And he could take $100 or so now-that would be much fairer than what he is demanding.
But by raising the monthly payment by over $600 now and then raising it again in a few months,he shows just how greedy he really is.
You are all so lucky that you have or had reasonable trustees that want(ed) you to succeed!

[Zombie13]

Barbisi's husband here... comparing the Form J's from 2017, and today (I sent the updated one to our attorney), line 23c - monthly net income - shows we have an increase of $105 per month, compared to 2017. WOW! Good thing I'm sitting down because now I'm all dizzy with this tremendous increase in income.
What really annoys me to no end is, the trustee did not: consult with the attorney, request an updated expense form (form J), etc. The trustee arbitrarily reviewed my most recent paystub without having a clear understanding of the current expenses and reasoned, "we have an additional $600 or so monthly now". This is false.
Interestingly, in 2017 our monthly net income was $335, but the trustee and attorney agreed on a monthly $559 payment: $224 more than our monthly net income, per the form J.

[Zombie13]

The Trustee should need to file a Motion to Modify Confirmed Plan in order to raise your monthly payment. They can't do it arbitrarily when there is a confirmed plan in place. Your attorney should object to the Motion to Modify Confirmed Plan and go to bat for you.

Hey there JustBroke. The trustee did file the motion; our attorney received it this morning. But, the trustee did not contact the attorney, nor request an updated Form J (expenses).

[justbroke]

Hey there JustBroke. The trustee did file the motion; our attorney received it this morning. But, the trustee did not contact the attorney, nor request an updated Form J (expenses).

For what it's worth, some Chapter 13 Trustees prefer to just do things by motion and not contact the debtor and/or debtor's attorney. It is exactly how my Chapter 13 Trustee behaved and I asked him and he said that was just the standard for his office. The standard was that they prefer to have everything well documented.

I'm glad to read that the Trustee is actually filing the required motion and your attorney is ready to object.

[Zombie13]

Thank you justbroke. What has us concerned is, the attorney is expressing, what I would consider, "mild surprise" by the trustee's approach. The attorney stated, they have never had the Trustee file for a Modification in any case that they have had. Additionally, they would have thought the Trustee would have requested a new breakdown of monthly expenses prior to taking this action or at least contacted them. NOTE: I am very slightly modifying the attorney's quote in the prior sentences.

So, based on the attorney's response, we feel concerned. My impression is, the attorney has a long working relationship with the trustee.

I hope, the trustee is only focused on well-documented income and expenses. I question that though... - they did not ask for updated expenses, prior to filing this motion. They only looked at one side: the Increased Income side; the increased expenses perspective was completely, and conveniently, ignored.

I find it frustrating that the trustee (or their attorney) has requested from the court, an increase in payments, without requesting our evidence of increased expenses. And apparently, that's acceptable to the court. I reason, our full financial picture should be requested and disclosed, before deciding if a court session/discussion is worth pursuing is worth the expense and time. I argue, it is not - an overall increase of $105.00 per month is not worth anyone's time: not the trustee, not the court/judge, not the attorney. But hey what do I know right? I'm just an engineer with basic math skills.

[flashoflight]

Zombie13 , how did the trustee get your most recent paystub? I had to turnover every single paystub up to the agreement on the confirmed plan between the trustee staff attorney and my attorney but none since then. If my trustee all of a sudden asked for a paystub, I'd be very concerned.