Trustee Payment Amount vs. Expenses

[BrokeinCA]

[lrprn]

You need to sit down with your lawyer and go over what he/she put in your plan filing on the Means Test and Schedules vs. what you have listed here. Don't leave until your lawyer explains every significant discrepancy. Ask what your trustee may accept for maximum living expenses. There is often some "wiggle room" there.

Also cross-check your expenses here - http://www.goainc.com/fraley/calcula...alculator.html . Get out your old checkbook registers and look back one full year to find any infrequently recurring payments you may have overlooked. Then pull your credit card receipts online and do the same.

If after doing all this and walking through the updated expenses with your lawyer, your monthly Ch 13 payment is still at what your lawyer estimated, then unfortunately it is what it is.

I'm sorry you are having such a tough time right now. Hang in there and work with your lawyer. Whatever you do, do *NOT* sign a Ch 13 payment plan that you know you cannot sustain over the long haul. But also keep in mind that lifestyle changes are often necessary to get the debt relief you desperately need. You may have to consider surrendering an asset if that will get your payment down to a more manageable level.

[liz417]

Hi there, I'm from the Inland Empire and I had to consult with 6 different attorneys before I found one that would file a ch 7 for me (most wanted to push me into a ch 13 because I am over the median).

PM me if you need more info. Have you paid this attorney in full yet? Don't sign on to a ch 13 repayment plan IF you KNOW it's going to fail....if you in the negative, you should try to file a ch 7. Are there some assets you are trying to save? Just trying to figure out why your attorney wants to push you into a ch 13....

[justbroke]

This was calculated wrong, or you are misunderstanding. Your DMI and "Trustee Fee" work in tandem. If the DMI goes up, the Trustee fee goes down, and vice versa.

This leaves my budget with a 330 negative balance based on the IRS Allowable, not my actual budget.

Your "actual budget" doesn't matter. It is what comes out after you meticulously adjust the amounts on your Form B22C and your Schedule J that matter. Being within the guidelines helps, but you can go outside them in many areas (like energy costs).

I live in the desert. My eclectic bill alone nearly reached the IRS Allowable each month, not to mention I still have to pay for gas, water, sewer etc.

My electric bill is over the limit and I added the allowable "home energy costs" on line 42.

We also are not including cable (which we can cut), Internet, and home phone. I can eliminate my 401K contribution and will have an extra 180 a month, but that still leaves me in the negative and I though 401k was allowed.

Of course you don't need to eliminate the 401(k) contribution

How did I miss that the Trustee fee is in addition to you DMI?

There is something wrong in the calculation. Look again. I use both a spreadsheet and a program designed for Bankruptcy filings. The DMI and Trustee payment are mutual. I don't know how you missed it, but the Trustee fee is an "expense" which is counted as your monthly expenses. It decreases your DMI. Your actual DMI, if you didn't include the Trustee fee, would have been larger (by the amount of the Trustee fee).

It does technically come out of your DMI!!! You are just misunderstanding what your DMI is. Your DMI is your income less allowable expenses and debt service (NOT including the Trustee fee). That's your DMI.

The Plan and the budget are very important. I don't understand how you ever reached a negative DMI, yet you need to repay 80% back and that payment is over $3K/month.

There is definitely something wrong with the calculations and you and your attorney need to sit down and really go over the numbers.

[zeezee]

Mortgage $1,562.00
Car Payment $489.00
Car Payment $489.00
Utilities $400.00
Cell Phone $117.00
Insurance (Auto) $238.00
Insurance (HO) $91.66
Property Taxes $398.68
Trustee $3,275.00
Auto Registration $30.08
Auto Registration $25.58
Motorcycle Registration $9.25

Subtotal $7,125.26

I see your miscalculation right above ^

You have counted your trustee fee of $3,275 as a monthly expense rather than breaking it down over the 60 month period ($54.58). That right there is where the $3,000 is coming from.

[BrokeinCA]

Thanks for the Help

The Trustee Fee included in the budget is our monthly payment to the plan including the trustee's fee.

My confusion comes from the fact that our attorney told us our DMI is 2945. He said that our payment to the trustee will be our DMI PLUS the Trustee Fee which is $330 for a total of $3275 per month to the trustee. The trustee fee just ate up $330 from our budget for living expenses.

My understanding was that the plan payment to creditors and the trustee fee together should not exceed my DMI. I guess I am just really confused how I missed that.

When I explained to my attorney that I though our plan payment would be our DMI and from that the trustee would take his fees and all the rest would go to our creditor, he informed me that was prior to October 2005. Now you must pay all DMI to creditors and your trustee fee is paid on top of that.

We are trying to keep our house and strip our second mortgage, but I don't know if that is possible. I don't have an aditional $330 of wiggle room once I pay the plan payment, my mortgage, car payments and living expenses.

[BrokeinCA]

This was calculated wrong, or you are misunderstanding. Your DMI and "Trustee Fee" work in tandem. If the DMI goes up, the Trustee fee goes down, and vice versa.

Your "actual budget" doesn't matter. It is what comes out after you meticulously adjust the amounts on your Form B22C and your Schedule J that matter. Being within the guidelines helps, but you can go outside them in many areas (like energy costs).

My electric bill is over the limit and I added the allowable "home energy costs" on line 42.


Of course you don't need to eliminate the 401(k) contribution

There is something wrong in the calculation. Look again. I use both a spreadsheet and a program designed for Bankruptcy filings. The DMI and Trustee payment are mutual. I don't know how you missed it, but the Trustee fee is an "expense" which is counted as your monthly expenses. It decreases your DMI. Your actual DMI, if you didn't include the Trustee fee, would have been larger (by the amount of the Trustee fee).

Is sounds like I am understanding. That is exactly what I thought my DMI was. My confusion is how I misunderstood that your plan payment is the Trustee Fee in addition to your DMI. My DMI is 2945 (according to my attorney) but my plan payment according to attorney MUST (his words) be 3275 to include the Trustee Fee.

[justbroke]

My confusion comes from the fact that our attorney told us our DMI is 2945. He said that our payment to the trustee will be our DMI PLUS the Trustee Fee which is $330 for a total of $3275 per month to the trustee. The trustee fee just ate up $330 from our budget for living expenses.

There's something wrong. I'm totally confused. I can't tell if you're DMI is really $2,945 or if that a combination of your debt service payment with your DMI!

You listed your net income as $8,233/month, but didn't list any income tax payments (federal, city, and/or state). You also don't list any contributions to any 401(k)/403(b) or other ERISA qualified retirement plan.

You really need to do it based on gross and subtract your income taxes as an expense (allowance).

I think you need to go to LegalConsumer.COM and run the Means Test there.

[SMinGA]

Sounds like something is wrong with this attorney... Based on that logic all 13's would fail. Your plan payment + living expenses should leave nothing more. The trustee fee comes out of the plan payment, rather than adding to it.

[lrprn]

Sounds like something is wrong with this attorney... Based on that logic all 13's would fail. Your plan payment + living expenses should leave nothing more. The trustee fee comes out of the plan payment, rather than adding to it.

SMinGA, it's against the forum rules to post to old, outdated threads like this one. The rule exists because these old threads might contain information that was accurate at the time, but is not accurate now.

Also many of the posters on old threads are no longer active forum members and won't see your comment or question.

In the future, if you have something to say or a question to ask, please start your own thread rather than posting to a long-inactive thread like this one. Thanks!

[SMinGA]

Sorry - I did not realize it was an old thread. Don't recall how I came across it.