Annual Report

[broncho14]

I received my annual report from the Trustee and it stated the following:

"Your plan obligates you to pay a minimum amount called a base. The base amount is established at $53,800. You have paid a total of $10,600. Thus the balance on your base is $43,200."

"The base balance is not necessarily the amount required to pay your case in full and should not be used to determine your payoff amount."

"Very Important In addition to paying the base amount you must also pay the percentage to your unsecured creditors per your confirmed plan and stay in the plan until the "Greater" of the two is reached; either the base amount or the percentage amount."

My question is this: I thought if you got out early you had to pay 100% to unsecured creditors. My attorney says that this is not the case. My percentage payback is 56%. He says that if I save up enough money that I can buy out early as long as I pay the greater of the two amounts. He says that the trustee agrees. I am not so sure. I would hope that it would be the case but everything I have read on this forum does not indicate that to me. However, I am reading the report from the Trustee's Office. I am confused.

[justbroke]

My question is this: I thought if you got out early you had to pay 100% to unsecured creditors. My attorney says that this is not the case. My percentage payback is 56%. He says that if I save up enough money that I can buy out early as long as I pay the greater of the two amounts. He says that the trustee agrees. I am not so sure. I would hope that it would be the case but everything I have read on this forum does not indicate that to me. However, I am reading the report from the Trustee's Office. I am confused.

You must pay 100% in order to buy out of a post-BAPCPA confirmed plan (period). If your case was confirmed after 10/1/2005... you are post-BAPCPA.

There has been absolutely not one case I have read where a post-BAPCPA case was paid-off early at less than 100%. Ask your attorney for a post-BAPCPA case citation. We'll be happy to review it here.

I should be more specific when I wrote 100%. The real phrase is this. You must pay 100% of all allowed unsecured claims in order to "buy out" of a post-BAPCPA confirmed plan.

The reason why your Trustee report reads... "the base balance is not necessarily the amount required to pay your case in full and should not be used to determine your payoff amount", is because it's NOT a payoff amount, unless you were paying 100%.

Let me add though, that Trustees will file an objection when because you are not staying in Plan for the applicable commitment period and will file a "bad faith" objection. Since this is still new territory, no one really knows, but the consensus is on the side that you can't, under post-BAPCPA, buyout early with less than 100% of allowed unsecured claims being paid.

What District are you in?

[justbroke]

I will add that my prior and recent research has shown that there is some theory about getting out of a plan early, but it requires a well planned pair of motions, timed perfectly.