% Payback (it doesn't matter)

[justbroke]

What does non-dischargeable mean?

Means that you will have to pay for it. Can't be "included" in the Bankruptcy.

The key for your State will be, is a timeshare deeded real-estate, or is it just an executory contract / luxury good or service?

is this how the state views it or does my paperwork tell me what it is?

It is how your State views it and/or how the paperwork reads. If the paperwork reads that you are purchasing "an interest in real estate", then it is likely treated as such. If you purchased just "usage" then it is not a real estate interest.

If it's an executory contract... just reject the contract. If it's a luxury good (unsecured debt), then it will just be discharged... if the Trustee abandons it.

which of these would help us keep it?

Neither. An executory contract, is just a contract that you may want to end, so you would reject it by motion. The Trustee may abandon it (not want anything to do with it) because Timeshares are notorious in Bankruptcy for being the hardest thing to sell. Generally the Trustee will probably try to make a deal with you so they don't have to deal with it.

would you mind helping me word the question I should ask my lawyer about this? this is one of the most important things I want to know about. thank you so much for your help

You just need to ask your attorney two things.

1. Is my interest in my timeshare a "real estate" interest?

2. (Regardless of the answer to #1) What is your recommendation to deal with the timeshare?

Hopefully, they'll guide you through the process.

[indebt00]

thank you so much for your help

I went and looked up our timeshare stuff...we have a deeded intererst in real estate....I am hoping we can reaffirm (or whatever the term is in ch 13) the loan on this and keep it. crossing fingers

[parsoc48]

We included ours in the BK, it's a deeded timeshare (Shell Vacation Club)and the result is "collaterral to be surrendered". Interestingly enough, they offered to settled for $1200 just before we filed and we owed $8000+. Go figure

[justbroke]

We included ours in the BK, it's a deeded timeshare (Shell Vacation Club)and the result is "collaterral to be surrendered". Interestingly enough, they offered to settled for $1200 just before we filed and we owed $8000+. Go figure

That's because no one wants a timeshare these days (well, at least not a Bank). Also, the maintenance fees are usually where the real money is lost.

[floridian]

ok, this is helping me understand a 13 a litle better...ok, my lawyer wants me in a 13, due to DMI, he says im looking at 300 per month for 3 years...

i know the trustee gets a cut and the lawyer, right?

so, do you think that the 300 is the bottom line with their cut, or is it possible to whittle it down further if i find more expenses to reduce the DMI?

and, in a 13, do you still have to give back luxury items the same as in a 7?..i guessing the trustee would think if you can afford a luxury item, you can pay more for your plan, right?

[justbroke]

ok, this is helping me understand a 13 a litle better...ok, my lawyer wants me in a 13, due to DMI, he says im looking at 300 per month for 3 years...

i know the trustee gets a cut and the lawyer, right?

so, do you think that the 300 is the bottom line with their cut, or is it possible to whittle it down further if i find more expenses to reduce the DMI?

and, in a 13, do you still have to give back luxury items the same as in a 7?..i guessing the trustee would think if you can afford a luxury item, you can pay more for your plan, right?

I have no clue how your lawyer came up with $300 a month, as he has all your financial data. Generally, you pay 10% to the Trustee for any "in-plan" payments that the Trustee makes. Also, your lawyer may charge some fees in the Plan as well, and these need to be paid over the duration of your case.

For 36 months, $300 turns out to be $10.800 over that period. I'm sure your lawyer is getting a little, and the Trustee would have earned about $1,080 (based on 10%, but usually less) for handling that $10K.

In a Chapter 13, you don't have to surrender luxury items, but if they don't have exemptions, you may have to pay their "value" to your unsecured creditors.

[CH33 Paralegal]

HHM
Rather than a "20" do you think a 13 would be better for us or would we just have to give any savings on the mortgage to unsecured debt? We are also behind on property taxes.

I'm sorry, but a CH20 is that of a lifestyle filer or a "stay junkie" you shouldn't want to do multiple chapters and on top of that add them up for a custom bankruptcy experience.

[deannal]

percent payback

i had a 341 today and the trustee stated that i would be paying back 22% but when i go to ndc it states 100% payback. total debt 27,000 and i will be paying 285.00 a month for 5 years and that certainly is more than 22%. she also made a statement that because i filed a chapter 7 in 2005, that the other 78% would not be discharged. i know i can file a 7 again in 4 more years but i am confused as i know its more than 22% and why my attorney did not make me aware of this.

[lomaxarts]

We own a very small house outright (800 sq feet that needs lots of TLC). The house is part of a homeowners association/club where we cannot have mortgages or home equity loans and the house is worth between $150-$200 (we are waiting for the appraisal). Because we have 100% equity and about $150k in unsecured debt, it was suggested by one lawyer that we go with chapter 13 to save the house. But since it will take 5 years, can we continue to fix the house? Or will we not be allowed to put any money into the house. If we went chapter 7, we don't know whether the trustee would let us stay in the house until it sells, and rent is very expensive around here. And we have a dog and a cat and it is hard to find places that will allow pets...I guess I am feeling really confused and shell struck. Any advice? which would be better, which would cost us more? Would it be better to file chapter 7 (we are both self-employed) and get it over with? 5 years sounds like debtor's prison.

[Allen]

Ok...many people are getting hung up on the percent payoff in a chapter 13, meaning the percent that is being paid to unsecured creditors.

Let me say this crystal clear....

The % you pay to your unsecured creditors DOES NOT MATTER.

There is no minimum and it isn't even a factor of your plan. The % payback is a flexible number, it is merely informative. There is not even a reference in the BK code to the % payback. The ONLY numbers that matter in a chapter 13 plan are...
1. Net Disposable income (on the means test, referred to as Disposible Monthly Income, DMI).
2. Liquidation value of your BK estate.

Your net disposable income (NDI) is simply your Gross Income minus your allowed expenses. That is how your plan payment is calculated. If your NDI is $100, then you are paying back $6,000 over 60 months, if your NDI is $1000, you are paying back $60,000 over 60 months. What ever percent payback that equals is what it is; but the % pay back is merely "informative", but has NO legal significance. For example, if you are paying back $100 per month, but you get a $1,000 tax refund, that will necessarily change your % payback.

Liquidation value is simply the value of your non-exempt assets, if any. In a chapter 13, you are required to at least pay the value of non-exempt assets. In many cases, the liquidation value is 0; so your chapter 13 plan payment is simply based off of your NDI. However, if your liquidation value is $50,000, then your chapter 13 plan must "at least" pay back $50,000 over the course of 60 months. Caveat, your plan payment is still going to be based on your NDI so if your NDI would exceed that $50K, you will be paying back the larger amount, where people run into trouble with liquidation value is if they don't have enough NDI to cover the non-exempt equity, in which case, your chapter 13 would be dismissed.

Bottom line, your % payback to unsecured creditors has absolutely, positively, NO legal significance. It is merely an informational number subject to change based on your true NDI over the course of the plan and the creditors that actually file claims.

If I have a zero NDI, all my debts are unsecured, and the liquidation value of my estate is zero, would my plan be confirmed? If so, then there would be no payments and my discharge would be in a few months. Right? Or am I just dreaming?

[justbroke]

If I have a zero NDI, all my debts are unsecured, and the liquidation value of my estate is zero, would my plan be confirmed?

Yes, but with some exceptions. There are some Districts, don't ask me to name them but it's only one or two, that require you to pay at least 10% (or something like that). The large majority of the Districts, a Plan can be confirmed with no payments to unsecured creditors.

[QUOTE=Allen;304567 If so, then there would be no payments and my discharge would be in a few months. Right? Or am I just dreaming?[/QUOTE]Dreaming. Generally, you would be paying your secured creditors through your Plan. You would have mortgage and car payments, tax payments and perhaps even arrearages. If you have absolutely nothing being paid, this is HHM's back door Chapter 7, so the question would be... why are you filing a Chapter 13?

[Allen]

Back to my NDI. My total income is from Social Securtiy and Supplimental Securtiy Income (SSI). These are direct deposited into my acccount. I then write checks for the bills. I know SS and SSI are exempt from a bank levy.

So why do I want to file a chapter 13, which I haven't started yet? Just a week before the bankruptcy laws changed in 2005 I filed a Chapter 7, In Pro Se. I had two judgements. One of them attempted to levy my bank account. Even though my money was exempt, the bank took $75 out of my account for themselves, as a legal fee, just for responding to the levy. I understand this fee is now $100 and all the banks charge this.

All of my debt is from credit cards (and high APRs and fees, which when added together come to over 30% on some of the cards). This levy attempt was just before I filed for Chapter 7. My current credit card debts were incurred AFTER my Chapter 7 was discharged in Feb. 2006. Currently, my debts are listed as paid as agreed in my credit reports. So why file a Chapter 13 now? Well first, Chapter 7 is not an option at this point because 8 years have not passed. Four years will have passed since my chapter 7 discharge in Feb. 2010. So why file for BK at all? (I'm getting to this, so please bear with me as there are some pertinent details to this) I mean being as I am judgement proof and don't own a home or even a car and all my property is exempt (at least I think it would be, I'll get to the possible exceptions shortly) then why file at all?

The first reason I already explained is the levy resonse legal fee the bank takes out your account the same day they receive the levy. Although, I currently do not a any new judgements against me since the chapter 7 since I am (at least of this posting) current on my present debts. The problem is in my state (California) the governator has lowered my SSI benefits by $57 so far and other cuts to my SSI income are on the horizon. The states pay a portion of their residents SSI but not the Social Securtiy. To make up this lose, I've had to partly rely on my credit cards to buy groceries. I can't afford to pay more than the minimum payments now on these high rate cards.

The possible exceptions to my unsecured debt may be Dell, of which I writing this now on their financed (since Dec. 2008) laptop. I also financed a printer through them. The other possible exception is Fingerhut, which I financed a color TV about a year ago. I know Dell claims to have a "Purchase Money Security Interest" on the laptop and printer in their credit agreement and it states they will reposses them in their agreement if one defaults on them. I wish to keep the laptop, the printer and the color TV. In my state, California, all my property would be listed as exempt, system 2, I think. But, can secured property be properly listed as exempt? And if so, would this stop a creditor when one is in bankruptcy?

I read in Nolo's do it yourself Chapter 13 book, that if a creditor has not "perfected'' their lien in 20 days that they then do not have a secured interest and to list thier property on the BK forms as unsecured giving Fedelity Services, Inc. v. Fink 522US211 (1998) as reason.

The reason I wanted to list Dell and Fingerhut as unsecured would be that being as I would have a NDI as zero, being as I need now ALL my income to live on, maybe I wouldn't have to list them as secured creditors and successfully challenge any attempts by them otherwise. Then I wouldn't have to pay Anything on my plan and could keep all my low income to live on.

This would wipe out all my debts legally, that wouldn't turn into judgements and $100 fees to my bank account which I like having to pay my bills, instead of buying money orders. I would then be able to keep $183 of my income to eat mostly. My monthly payments to Dell and Fingerhut are $47.

Perhaps, so my Chap 13 plan would be approved, I should just list Dell and Fingerhut as secured creditors still giving me $136 that I would not have to pay (I think ) to the unsecured creditors. These $183 and $136 amounts are monthly income amounts I would have left over if I did not have to pay my credit cards, Dell and Fingerhut. It would also put a legal end to my unsecured debts and maybe look better on my credit reports with a chap 13 than just defaulting on them. This could be of significance if I want to rent another apartment again. Sorry this was so long but I thought these details are important.

[HHM]

Allen, you should start a new thread with your questions.

And, for the love of all that is holy on the internet, use the ENTER key and put things in paragraphs.

[klandsb]

HMM. I know you say % doesnt matter but how do they decide who gets what... Say u owe cc #1 $10,000 and cc#2 $5000 cc#3 $700.... So you have lets say $350 a mth dmi..... Do they break it down so everyone gets a fair share but in the end one creditor may get more than the other ???? And it seems kinda time consuming for them to send the pmts to the creditors every mth. Maybe I am missing something

[klandsb]

I'm so sorry... I typed in HMM instead of HHM.. Can u tell I have had a long day !!! Havent been sleeping well with all this BK stuff to think about