Is schedule J past expenses or future expenses?

[bkinthecouv]

We just filed a ch 13. Paperwork was originally prepped by the atty in September and we filed at the beginning of this week (12/8/09). I did not think to update the expenses, and the atty never asked. My expenses have changed though. One change in expenses was due to our adjustable rate mortgage going down, which I'm freaking out about.

My question is that to update the schedule J, should it reflect expenses for the last 6 months or should it reflect estimated expenses for the foreseeable future?

We are below median (barely), but have positive DMI on our current schedule I/J.

I'm freaking out about our 341 meeting scheduled for next month.

[lrprn]

My question is that to update the schedule J, should it reflect expenses for the last 6 months or should it reflect estimated expenses for the foreseeable future?

Schedule J should reflect expenses for the last six months *before you filed*.

Ch 13 trustees and filers can take significant, permanent changes into account after filing and file a modified plan with the court that reflects the new financial circumstances. How significant is your change dollar-wise? Have you had any increases in your expenses since filing that would offset your lower mortgage?

[HakunaMatata]

Do you still have an ARM? If so, when is it scheduled to reset again? I had an ARM as well; and, I wish I could offer advice. I filed C7 and I'm surrendering my house. My ARM reduced prior to filing and this was one of the reasons I had to file quickly (in order to avoid reflecting this reduced cost). Like you, I was barely below the median (and expecting a rather insignificant income increase which would have placed me over). I didn't have any assets I wished to protect so C13 didn't make its way into my financial picture.

lrprn-

In a situation where are person has an ARM, would the plan have to be adjusted every time the ARM adjusts (provided the cost is significant)?

[lrprn]

lrprn- In a situation where are person has an ARM, would the plan have to be adjusted every time the ARM adjusts (provided the cost is significant)?

If the filer knows ahead of time when their ARM is adjusting (typically increasing significantly) and the increase is predictable, smart Ch 13 lawyers build the mortgage increases into the Ch 13 plan and the Ch 13 payments are reduced accordingly as the ARM adjusts upwards. Sometimes it's even possible to flip to Ch 7 if the adjustment amounts upward are very high.

However, since most ARMs are tied to current interest rates at the time, because this makes it impossible to predict what the increase (or decrease) is going to be, most of the time a Ch lawyer can't build specifics into the plan at filing. Still, a savvy Ch 13 lawyer makes sure the trustee is aware of when mortgage adjustments will take place for a filer so an amended plan doesn't come as a surprise.

[bkinthecouv]

How significant is your change dollar-wise?

Our payment went down almost $350 dollars per month. Our plan payments were figured at $190/month. All our secured payments are paid outside the plan. We did a 13 to try and strip the second. If the plan payment goes up dollar for dollar due to the ARM reset (i.e. $540/month plan payments.) I think I'd rather try and get into a 7 and not strip our second mortgage. We were below median by about 4K/year.

Is it easier to repair your credit after a ch 13 than a ch 7? I have student loans and mortgage car payments that will show on time pay history post BK.

How difficult is it to convert? Can you convert even if the trustee disputes the plan? If he tries to dismiss?

Is that viewed as two bankruptcies on your credit report?

Have you had any increases in your expenses since filing that would offset your lower mortgage?

We def. have more expenses that we could include. We could probably even come up with another $350 to even it out. Just not sure how that will be viewed by the trustee. Also, our mortgage is really low now with the ARM reset. I'm worried that since our mortgage is low, the trustee will think we should have a ton of extra money each month.

I have not told my attorney about the reset yet. Should I, or should I wait and see if the trustee asks about it?