5 years to 3 years...How?

[arlington]

How do some people convert from 5 years to 3 years while in their 13? What lucky situation has to happen for this to occur?

[kornellred]

It's probably more like an unlucky situation. The BK court must approve changes to a confirmed plan, and you have got to get the trustee on board before the court is even approached. Or....a debtor might suddenly find enough money to pay back 100 percent of the debt and request that the Chapter 13 get moved along a bit faster.

[woeisme]

I believe that 3 years plans are only if you are making below the median income or if are paying back at 100% and that can be done in 3 years. So as kornellred said, not necessarily rosy scenarios, either you aren't making much income or you aren't getting any debt forgiven, just allowing the payments to be done through the trustee.

[cwillie]

Woe I don't think it's like that. We are above median income and only 6% payback to unsecureds and confirmed on a three year plan, not sure why, but I'm not complaining!

[justbroke]

The 3 years versus 5 years is a function of law. If you are above the means test (after BACPA of 2005), then you are in a 5 year plan, unless you pay back unsecured creditors 100%.

Some people "buy" out of their Plan early... but generally, you have to wait at least 36 months (3 years) before you even approach the court to do this.

Your income may change as well, and you may be able to convert to a 3 year Plan... however, arrearages will hurt. That's why I'm paying my vehicles and real estate arrearages in 36 months (accelerating the payments) in my 60 month (5 year) plan... just in case!

Hey, but I'm no attorney, and this is my first time. I'm trying to learn from the pros.

[banca rotta]

Woe I don't think it's like that. We are above median income and only 6% payback to unsecureds and confirmed on a three year plan, not sure why, but I'm not complaining!

This is odd. I'm surprised the trustee didn't file a motion or dispute this. It's written in the law book the way others here explained it. It's either 100% payback or below the median.

Glad you were able to beat it, but it doesn't sound right.

[cso5@]

This is odd. I'm surprised the trustee didn't file a motion or dispute this. It's written in the law book the way others here explained it. It's either 100% payback or below the median.

There must be local variations - because my plan is neither 3 nor 5 years. It's 58 months. (not that I'm complaining, either!) And I am below the median, I pay about 5% to unsecureds, and had mortgage payments to catch up in the plan.

I think there is no -- this is the law, this is how it works -- because there seems to be so much variance due to local practices.

[DUMBAGAIN]

hum we are paying back 100% at 5 years, at least that's what my lawyer has said so far.

[catalina2225]

I am above median and am only paying back 1%. I too am in a 3 year plan. My car is bein paid inside the plan and will be paid off about 8 months before the end of the 3 years. I sure am glad I am not in a 5 year plan since I want to retire asap.

[justbroke]

There must be local variations - because my plan is neither 3 nor 5 years. It's 58 months. (not that I'm complaining, either!) And I am below the median, I pay about 5% to unsecureds, and had mortgage payments to catch up in the plan.

I think there is no -- this is the law, this is how it works -- because there seems to be so much variance due to local practices.

It's a function of law. A plan must be a minimum of 36 months and a maximum of 60 months, based on your income level. Above medium income filers have no choice on the 60 months. (I think that's where everyone is getting hung up... on the minimum part!)

Most lawyers will make your plan 58 or 59 months in a 5 year plan (60-month plan), just to make sure all payments are done in 60 months. (Just in case something happens.) however, the calculations which set forth your Disposable Income are all based on 36 months or 60 months, as an operation of law. How the payments are spread over that 36-60 month window, are detailed in your plan... simple as that.

The law only determines that the minimum is 36 months, and that if you're above medium income, then it's 60 months (which is also the maximum period by law).

Since you have mortgage arrearages, your lawyer spread your payments beyond the 36 months that you are required. This allows you to have a LOWER payment sent to the Trustee over those months. Otherwise, you may find you had no money at all!

Below medium income filers are a little more lucky than above medium income filers, in that the they can spread their payments out to 5 years. 5 years is the absolute maximum period a plan can last. So those already at a minimum of 5 years, have no room to move!

[NowImDownInIt]

Okie.... I am in a 36 month plan with a WELL below median income and paying 700 a month with 60% to unsecured. I think it was the means test that put me there, but I was originally told I'd be in a 60-month plan with a 400 a month payment.

It really just depends on how you look at it whether it's lucky or unlucky. I'm paying 300 more a month, but in 3 years I will be done with this all. lol