Paid Monthly vs. Biweekly

[jpdude]

Question about my Chapter 13 repament amount.

I get paid biweekly and my gross amount is $2800. This works out to $6200/month, and per the means test I have $1,800 residual to pay into my plan.

But in actuality, when I get paid 2x a month I only have $5600, not $6200, each month...2 months I have an extra paycheck, sure. But the other 10 months, I REALLY only have 1,200 residual to pay into my plan.

How does the trustee handle this? Will they only take 26 biweekly payments rather than 12 monthly payments??

[jpdude]

correction... my NET biweekly is 2,800.

[arkienurse]

Question about my Chapter 13 repament amount.

I get paid biweekly and my gross amount is $2800. This works out to $6200/month, and per the means test I have $1,800 residual to pay into my plan.

But in actuality, when I get paid 2x a month I only have $5600, not $6200, each month...2 months I have an extra paycheck, sure. But the other 10 months, I REALLY only have 1,200 residual to pay into my plan.

How does the trustee handle this? Will they only take 26 biweekly payments rather than 12 monthly payments??

I am paid biweekly also. When the lawyer helped figure our income, they took this into account. My monthly payment was set at- Um, I can't remember what. But they took 588 per check out of my paychecks. So I actually paid an extra month's worth of payments every year.
Your laywer should have taken your biweekly pay into account when figuring the payments. I would definitly ask if you don't think they did.

[jpdude]

Cool....i have yet to file. Met the lawyer, signed the retainer, completed the questionnaire on-line, got my papers together, adn tomorrow I am dropping of the package and a retainer fee...fingers crossed.

I'll bring up the bi-weekly pay issue.

[MajorMike]

I'm at bi-weekly and they didn't care one way or the other. They took the annual salary and divided by 12.

[CindyLou]

Majormike, aren't you paying the court directly once per month? The biweekly calculation would only matter if they are taking it out of your check biweekly.....

[MajorMike]

yes, I'm sorry. I think I mis-understood. I didnt even know a bi-weekly payment to trustee was an option.

[CindyLou]

yes, I'm sorry. I think I mis-understood. I didnt even know a bi-weekly payment to trustee was an option.

yea, if they do payroll deduction for the payment then the employer takes 26 equal payments per year....

you were one of the lucky ones that they allowed to pay on their own....

[arkienurse]

yea, if they do payroll deduction for the payment then the employer takes 26 equal payments per year....

you were one of the lucky ones that they allowed to pay on their own....

And I considered myself lucky by them taking the money automatically. There were quite a few things that came up during the course of our bk, that I would have been sorely tempted to pay the trustee a week later or something. Since it was auto deducted, I had no choice in the matter. We did without some things that I really hated to do without ( Sr pictures were the economy version, and I scanned the few that I did buy so other family members could have them. Son didnt' get to go on the senior trip,) But now it is over, and I am able to get a lot of the things that we had to do without.

[kornellred]

I was not aware that trustees can demand payment via wage execution (garnishment). Having payments removed from wages is a way of making it easier to fulfill the Chapter 13 plan - you can't spend money you don't receive. If you pay on your own and you start missing payments, your Chapter 13 gets dismissed and you are back to square 1. Wage execution is voluntary around these parts (New Jersey).

[brokeNconfused]

same here in Washington (state)

[SANRA308]

We are also paid 26 times a year, we had no choice but wage reduction because thats the way the trustee wants it done. But our job takes $550 a paycheck ,but the 2 months a year that we get paid 3 times we get to keep the $550. Our paln is for $1100 a month the attorney said it would either be that way or they would take out 26 payments at $507. I like it the way it is, its like a small savings account, and its great when we get the $550 before christmas. I also like the wage reduction becuase we dont even have to think about the payment its just sent.