Modifying the Chapter 13 plan because mortgage claim will be withdrawn

[womanonfire]

I reached a settlement with my mortgage to modify my loan and they will withdraw their claim of 34,000. I now need to lower payments because of a reduction of my hours reducing my income to half. So my attorney will file a motion to modify. He is on vacation for the next two weeks.

I have paid 6 months into a 36 month/100% plan. So taking the new balance, will my plan be divided by 30 or 36?

[justbroke]

Your plan should then be 100% - $34K - (payments made to date) / 30. So if your 100% was $72K and you paid 6 months (6 at $2K), then it's $72K - $34K - $12K = $26K. The new payment would theoretically be something near $26K/30 plus attorney fees in plan, and the Trustee fee. But that's purely a guess since there may be other factors.

Usually, when a plan is modified, the modification affects the remaining payments. The question more becomes what pressures would the Chapter 13 Trustee and/or your attorney have to keep you paying the same amount to be done earlier. Since your income is reduced you will need a plan modification and will likely submit a new Schedule I/J and maybe even a new B122C.

Best not to guess and let the attorney calculate the new payment.

[womanonfire]

The question more becomes what pressures would the Chapter 13 Trustee and/or your attorney have to keep you paying the same amount to be done earlier.

I know this is a late reply but this is a very good question! I am no longer represented by an attorney so I guess we will find out since I'm filing a motion to modify the plan and I'm going to try to change from 36 to 60.

I believe you said in another thread, there is no reason I should be in a 36-month if I'm paying 100%. I have no been able to find any case law to support that a below-median debtor should be forced into a shorter plan if paying 100%. It doesn't make any logical sense to me.

[justbroke]

I believe I would say something like... there's no reason you must be in a 36-month 100% plan. You can propose any plan length that is 60 months or shorter. The 36/60 month distinction is the basis for the minimum proposed plan based on the under/over-the-median income test.

[womanonfire]

Here is the new payment breakdown table I'm inserting in the motion to modify the plan. Again, below median debtor modifying 100% plan from 36 months to 60. I'm not sure if the trustee's fees are added in like this. If they are not, then technically, the unsecured creditors will be getting less than their claim amount.

ATTORNEY FEE - TOTAL $8000 - BAL. IN PLAN	4,700.00
STATE PRIORITY TAX	2,439.71
FED PRIORITY TAX	5,836.54
UNSECURED CC CREDITOR	1,412.40
UNSECURED CC CREDITOR	4,689.35
UNSECURED CC CREDITOR	1,265.80
STATE UNSECURED TAX	72.85
FED UNSECURED TAX	16,138.73
UNSECURED CC CREDITOR	1,988.53
UNSECURED CC CREDITOR	2,593.76
TOTAL	41,137.67
LESS PAYMENTS MADE TO DATE	17,540.00
NEW TOTAL	23,597.67
60 MONTHS	471.95
TRUSTEE FEE 10%	47.20
NEW MONTHLY PAYMENT AMOUNT	519.15

[womanonfire]

UPDATE: I successfully modified my plan however my math was off. So the new payment is $742 per month. I was paying $1920 monthly, so this new amount is still a win, especially since I did not incur any more attorney fees.