60 Months on Old-Law Chap. 13

[BK_Broiler]

Hello. I hope someone can clarify a couple concerns of mine regarding my Chapter 13 filing. I have read a few posts that state that under the old law, Chapter 13 bankruptcy would not extend beyond 36 months, and that only under the new law would payments be up to 60 months. But I am in a 60 month plan, even with median salary.

Also, I see conflicting information on options to pay off the plan early under the old law. Is payoff an option once I reach my third year in the plan? It seems like the 3rd anniversary is the light at the end of the tunnel, when things won't get worse...

From what I understand, at that point, your payments won't increase, regardless of your situation, and you have the option to pay off.

Thanks to anyone who can help me wrap my head around this!

[CATCHMEIFYOUCAN]

If you are not in 100% plan you are allowed to pay it off. If you are in a plan that only pays a certain percentage to all the creditors - you are not allowed to pay it off because the Trustee views that as "extra disposable," income you have. It doesn't help to reveal that "extra disposable," income !

Best of Luck, CMIYC

[tater71]

I was cruising the web site and thought I would post to this: that's what my lawyer told me also. if you're not 100%, which we are not, any "extra" payments are a red flag. It was explained to me that if you owe let's say 30K and are paying off only 20K, then the extra money would go to trying to pay off that missing 10K. I know how you feel about the 60 months, ours is 52. It seems forever carrying this monkey on our back. We should be done Jan '09. UGH !!!

Hang in there !
lori

[jal1129]

We filed ch 13 under old law and we had a 5 year plan, which we did finish!

[aa06a47]

Hello. I hope someone can clarify a couple concerns of mine regarding my Chapter 13 filing. I have read a few posts that state that under the old law, Chapter 13 bankruptcy would not extend beyond 36 months, and that only under the new law would payments be up to 60 months. But I am in a 60 month plan, even with median salary.

Also, I see conflicting information on options to pay off the plan early under the old law. Is payoff an option once I reach my third year in the plan? It seems like the 3rd anniversary is the light at the end of the tunnel, when things won't get worse...

From what I understand, at that point, your payments won't increase, regardless of your situation, and you have the option to pay off.

Thanks to anyone who can help me wrap my head around this!

Here may be some of the confusion...under the old law, you were required to contribute all disposible income for 36 months. If you plan went longer than 36 months, you were pretty much free to make what you wanted. The new law changed that to all disposible income for the applicable period (36 or 60 months depending on your income).

Your still governed under the old bankruptcy laws. Therefore, you simply need to contact the trustee after the 36th payment and request a pay off amount. (If you don't wait 36 months, you will be required to pay the creditors 100%).

Will people under the new law be able to pay off early and still pay less than 100%...still up in the air, though my attorney stated yes. I will see in 24 months.!!!