How do you calculate Chapter 13 plan?

[lawforever]

Does anyone have any information how to accurately calculate a chapter 13 plan? I do know that you would use Net Disposable Income from Schedule I and J, but how would you calculate it accurately? There are trustees who calculates the plan by hand. Does anyone have step-by-step instructions? Thank you.

Claire

[lrprn]

Does anyone have any information how to accurately calculate a chapter 13 plan? I do know that you would use Net Disposable Income from Schedule I and J, but how would you calculate it accurately? There are trustees who calculates the plan by hand. Does anyone have step-by-step instructions?

Claire, there are differences in how each bankruptcy district, local courts, even individual trustees within the same local court interpret the 2005 BAPCPA law and the case law associated with it. There are also differences in practices and customs in each bk district and local court as well. Because of these differences in interpretation across the country, there is no "cookie cutter" process to fill in the Ch 13 B22C forms and Schedules accurately in every case.

This is why retaining a bk lawyer who is very familiar with the interpretations and practices in the filer's local court is crucial to filing a Ch 13 plan that is both confirmable and workable over the 3-5 years it requires to complete a plan successfully.

[optimistic1]

Sure its rather easy too. And the moderator is correct by the way, listen to what he is telling you about local rules and hiring an experienced bk specialist, what I am showing you here is merely an example and should not be taken otherwise.

Once you accurately calculate what your disposable monthly income is, you multiply it by how many months your plan is, dependent upon if you are above or below the state median income.

This will give you a big number. Let say your disposable monthly income is $300, multiply it by 60 months (because you are above median), it gives you $18,000.

Now, the hard part for you.

You now determine what debts you have, unsecured, secured, tax debts, and you also will need to determine whether or not you have any assets that are not exempt. You need to value those assets and determine if you are keeping them or not.

Here is an example, an easy one

LINE #

1. Secured car loan, $10,090, value of car, $6000, this will be a secured creditor. The remaining $4090 will be a unsecured creditor. Proposed interest rate of 5%.

2. Tax debt of $3000. Just guessing an interest rate for tax, I dont really know about this part, lets say its 3%.

3. Assets that are not exempt, $1000.

4. Any attorney fees not completely paid in full, lets use an example of $1000.

8. Unsecured creditors totaling $20,900

Now is where you can use this tool,

http://www.trustee13.com/fundwiz/

Once you calculate your disposable monthly income, you will input it into the first section. Lets use the example I gave you above, and enter 60 months and 300 per month.

Now in the next section, you will enter in the credit claims as above, but you use payment order #8 for the unsecured claims.

Upon completion of you entering in all the data, it will tell you whether or not your plan is feasible, but this is just one part of filing a bk, your payments could change this way or that way depending on a variety of variables not be discussed here.

It will also automatically calculate a trustee fee of 10%, so you need not enter it as a claim.

Lets complete the example in the funding wizard.

My end result says

Your proposed Plan is Adequately Funded.
Your general unsecured creditors will receive $4,663.96 or 19%.

If you use this tool, it will help you determine whether or not your plan will work, your 13 will work or not, because if it wont, then you will need to revisit your expenses, your assets, leftover attorney fees, tax debt you could take care of now or later, and so on and so on. It really makes some people think about whether or not they should be keeping their house or not, because it sometimes will tell you that you need more disposable monthly income to fund a plan with a variety of debts, and to do that, you have to start looking at your living expenses. That means cuts into things like food, electricity, the mortgage, things you wouldnt consider changing, but to get your discharge, you would do anything to make it work. Ok. I am blabbering now.

Have fun with this tool, its what BK attorneys and some trustees use, I feel sorry for the ones who do this by hand.

[lawforever]

Thanks

Thanks optimistic1 for your detailed explanation concerning Chapter 13.

[optimistic1]

Yeah, no problem.

[flyinbroke]

Wow, after plugging in my car and my govt student loan, based on disposable income, my unsecureds get 0. Cool.

[optimistic1]

0 is nice, you get the best of both 13 and 7, if you get confirmed of course.