Chapter 13/dismissed cases

[sheilaE]

Question on cases that get dismissed:
We met with an atty early last month. Retaining him and will file this summer. During our initial meeting he "estimated" that our monthly payback payment would be somewhere around $1300.00 for 5 yrs @100% payback. After posting on here how shocked we were because that was just about what we were paying in cc payments each month and we were having a hard time making it through the month and would then have to use the cards for groceries & gas. Long story short-thanks to this site, we found out we were under estimating for basic living needs for a family of 5. After re-adding those numbers, we came up with a lower payback amount. Discussed it over the phone with the atty, who agreed that we had probably under estimated things and that we'd work on it.

So now to my question: What if the trustee doesn't agree with the numbers and we go back and forth trying to make everyone happy-but then suddenly they say DISMISSED, not working with you anymore. Can they do that? I mean, we just want to get through the month without struggling like we're doing now. We don't need to make a lifestyle change because we've never gone out and bought items or fancy clothes. We've never lived beyond our means. We are pretty average. We have 3 children, one with special needs. I'm a stay at home mom, (ever since our 1 child with diagnosed w/special needs) husband is in law enforcement. Want to keep the house, strip the 2nd ($55,000.00) and get rid of $80,00.00 worth of debt
Just can't figure out why some folks have their cases dismissed. I mean there are some who are at a 0% payback-why aren't those dismissed?

[momofthree]

Just out of curiosity, how did you get into debt if you've never lived beyond your means, and therefore don't require a lifestyle change? And how will you survive after filing with no credit available to you if you don't have a way to change your lifestyle? Was all the debt accumulated from one-time expenditures (non-recurring) for your special needs child?

[SMinGA]

For the most part, I think if you are honest & realistic with your attorney AND your attorney is good, then you should not have issues. Cases get dismissed if someone falls behind in their payments. Likely cause there is income/expenses change after filing OR they were not realistic. (Meaning they spend more than they thought.)

I imagine one can have trouble getting a plan approved thru the TT if there are disagreements about what is reasonable in one's budget. Perhaps expenses the TT thinks should go, but the filer is not able or willing to give up? If all of your expenses are within IRS guidelines AND you can back them up then there should be no problems. (Claiming $500/mo as charitable contributions when you have no paperwork to back it up would be a problem, for example.)

Or some have a minimum to be paid (based on priority debt or non-exempt assets) and just don't have enough DMI to make it work. That would result in a plan that can't get confirmed, but going back to what I said in the beginning a good attorney would not let you file if that was the situation.

[Flamingo]

(SNIP...So now to my question: What if the trustee doesn't agree with the numbers and we go back and forth trying to make everyone happy-but then suddenly they say DISMISSED, not working with you anymore. Can they do that? I mean, we just want to get through the month without struggling like we're doing now. We don't need to make a lifestyle change because we've never gone out and bought items or fancy clothes. We've never lived beyond our means. We are pretty average. We have 3 children, one with special needs. I'm a stay at home mom, (ever since our 1 child with diagnosed w/special needs) husband is in law enforcement. Want to keep the house, strip the 2nd ($55,000.00) and get rid of $80,00.00 worth of debt
Just can't figure out why some folks have their cases dismissed. I mean there are some who are at a 0% payback-why aren't those dismissed?

You can't have a Chapter 13 plan "dismissed" before you even file. What your attorney will do will be to submit a plan to the Trustee which is based on all the information you provided your attorney as to your debts, assets, income, etc., etc. and which meets the requirements of your state (exemptions, etc.). I also am wondering why you accumulated so much debt and were not living beyond your means. I am assuming you were relying on the credit cards to supplement increasing costs with your family of five and only one income and also costs associated with your special needs child.

A Chapter 13 case is "dismissed" after one has their plan confirmed and the debtors do not comply with the Plan requirements; i.e., not making monthly payments on time, not paying the mortgage payment, not submitted documents requested by the trustee that may be required throughout the plan, etc., etc. Also remember what you want to do as to filing and what you can do are two different things and in order to get through all this if you truly believe you can afford your home, you are really going to have to budget and lie low for the term of your plan and possibly look for outside non-profit, no fee sources to help with your special needs child - it's out there; you just have to make a few phone calls...

Best of luck to you...

[sheilaE]

I stand corrected. We did live beyond our means or we wouldn't be in the mess we're in now. I guess when I think of living beyond ones means, I think of fabulous vacations, designer clothing, vacation homes, big toys like RV's, quads, jet ski's etc, etc...but I know even without having those items-one can still live beyond their means-as prbably most of us have. It's been ongoing for many years. 2 incomes went down to 1 after our 3rd son was born and we realized he was going to need special care. Husbands O/T was cut. Moved debt from one card to another because of teaser rates. 1 day late and rates go up, soon all the cc raised their rates and then we were paying a crazy amount of $$$ to interest and hardly nothing to principal. We were spinning our wheels every month.
Actually now that we've been the decision to file, I feel so at peace. This site has been so helpful at calming my fears