Chapter 13 dismissal question

[quickteg]

I have been in my ch. 13 plan for 17 months now. I did miss one payment in September, but paid extra and got it caught up. Due to poor financial responsibility around the holidays, we missed our January payment but made the one for February.

Today my wife got a call from her payroll department notifying her that her wages were being garnished for the entire payment amount, effective immediately and for the duration of the plan.

Our rent check was mailed on 2/27 and WILL

[StaciMM]

Yes-creditors can come back and add interest. Expect them to. You mentioned that you are making more money now. Why not get in touch with the trustee (or have your attorney do it) and ask about adding the missed payment onto the end of the plan? And, call your landlord now-let him know something has come up and not to deposit the check. (If you mailed it yesterday, he probably hasn't yet.) I'm assuming that since you're making more money, you can be back on track within a couple of months.

I'm concerned by a couple of things. You're making nearly $3,000 more per month (granted, that is before taxes, etc.) yet you're skipping payments to your ch. 13. You are nearly half way thru the plan, and if you come out of it-things will affect your credit worse. (The BK will still be on you, and creditors don't view 'dismissed' as better than 'discharged'. In addition, you could end up with judgements since some creditors may not wait to see if you have good intentions.)

[quickteg]

Because....

First of all, I appreciate your response. It's always good to have another brain considering the situation before taking action.

Well, if I get in touch with the trustee it will be to tell her to shove it, as I cannot believe that they can so easily compromise the stability of my wife and I, and in fact, render us homeless without so much as a phone call.

I do not like the idea of wage garnishment simply because of the possibility of a serious life-altering event that would take precedence over making the payment. This is what happened when we missed the payment several months ago. What happens if I had to come up with an extra $1700 for emergency surgery? I wouldn't even have the option to do so, but the trustee would still get paid, even if I died.

More to your point, I understand that a creditor could potentially come after me on any account that I still owe on, but what about the ones that have been paid off? Would they even be notified?

Also, in my previous experience, I have successfully negotiated with creditors to keep the accounts OUT of judgement.

Then again, maybe I should let my anger subside before I do anything. Maybe I'll call the trustee and ask her ore one of her lackeys to make the choice between removing the garnishment or dealing with lost commision because I dismissed the case voluntarily.

[StaciMM]

Probably a good idea.

Then again, maybe I should let my anger subside before I do anything. Maybe I'll call the trustee and ask her ore one of her lackeys to make the choice between removing the garnishment or dealing with lost commision because I dismissed the case voluntarily.

[keepmine]

Time to calm down and think this through to a logical conclusion.
The trustee was not the one who screwed up.

Due to poor financial responsibility around the holidays, we missed our January payment but made the one for February.

Your first priority is the Chapter 13 payments. You get in a real emergency you can ask for a modification of your plan.
There is a real difference in a disharged Chapter 13 and a dismissed one. If you complete the plan {and you're nearly half done} the CRA's will delete 7 years from filing date. A dismissed one is 10 years from filing date and the attendant hassle from dealing with creditors who will likely turn this over to 3rd party collectors who'll leave slug marks all over your credit report.
I think the "hat in hand-humble pie" is the best approach. A huge apology and see if there can be some resolution.

[quickteg]

True...

Thanks for your input.

I guess I just feel disrespected because they couldn't even pick up a phone to inform me of what they were doing. It just seems wrong.

An apology won't mean anything in terms of getting the wage garnishment reversed. They already got what they wanted. The only thing I can do is have the case dismissed and they at least lose the 10% commission that they are getting from me.

3rd party collection agencies don't really scare me. Maybe they should. I wonder what they are willing to do in terms of debt negotiation.

[SinkingFast]

A good dose of humble pie would be the order of the day.

You say, "How Dare the Court!" leave you in this distress.

Honey, the Court don't care. Their attitude is,..........

Your lifestyle has to change, mine does not.

You need the help, I do not.

My finances are doing just fine, yours are not.

You'd already missed one payment earlier. You received grace from the Court once to allow you to make up that payment.

Once burned, twice shy. The Court nailed you the second time.

I don't mean to be rude, but they are playing hardball with you now. On their turf, with their rules. You're best off to negotiate something nicely with the Trustee, get thru the rest of your plan without further incident, get this whole thing behind you, and move on with your life.

Like the old song says,....... "You gotta know when to hold 'em. Know when to fold 'em."

[quickteg]

Thanks-

Thanks to all for your input. I probably will proceed with the plan, unless I figure something else out. I wonder how important that commission is to the trustee. Wouldn't that be cool if I could negotiate that fee down based on their incompetence?

I believe that even with two missed payments, my case has to be considered "above average" considering the dollar amount I am paying each month and the fact that so many chapter 13's are unsuccessful (Does anyone have statistics for that?)

Thanks again!

[SinkingFast]

The majority of all Ch 13 plans fail. The rate varies from state to state and region by region.

I think here, where we live, about 80% of all Ch 13 plans fail. I've seen other stats quoting an average of 65% failure rate.

[quickteg]

We missed a payment because we mis-calculated our Xmas expenses and also bought a used car (had to pay cash for it-couldn't get anyone to approve a loan)

Again, there's no sense in asking the trustee to settle anything because since they garnished my wife's paycheck, they are getting their money regardless, I don't think I'll be able to undo the garnishment.

[FDNYLadder124]

Quickteg,
Don't quit your ch 13, your in it, finish it up and get on with your lives, rebuild your credit, and take it as a learing curve.
ALSO-please don't take this the wrong way, but I can imagine the trustee decided to "garnish" your wive's pay due to the fact that you missed several payments. Your trustee obviously has a shred of decency, because my friend, he/she could have put forth a motion to dismiss your case due to non payment, be thankful that didn't happen.
Your # 1 obligation IS your ch 13 payment, period. If you ever have an emergency, you can contact your lawyer or trustee and they will amend your payments, and / or stop your payment for a month or two if you "need emergency surgury".
I'd also advise you keep your "garnishment" in force, thus you will never, ever miss another payment, and risk a motion to dismiss.
I'm sure a TON of people here on the boards have their payments taken right out of their paychecks, like myself, and after awhile, you never even know what your missing, as long as you stick to your budget, which sounds like it won't be a problem with a $35K raise.
I work for the City of New York, and I could use a 35K raise.........
So have a big piece of humble pie, and a glass of stop *****ing and take care.
Good luck with whatever you choose,
TonkaTruck

[FilingOnMyOwn]

Nicely said FDNY. I only make half of 35k, a year. I am able to live on it, and you got a RAISE that is TWICE my annual earnings, on top of what you were already making?

[quickteg]

Thanks to everyone

Thanks all for your input. Once I settled down a little bit I realized that at the very least the trustee is saving me a stamp and a trip to the bank to get that money order every month. I'm still pissed that she didn't notify me though.

By the way, I am on a 100% payback plan, so that's why I never told the trustee about my increase in pay. We're only paying for 36 months and can't shorten the amount of time we pay, so there you go.

Oh yeah 35k sounds like a lot, but I live in California and pay #1500 for 800 sq ft of living space.

Thanks again to all who helped me simmer down and not do anything stupid.

[Jman30]

I'm sure a TON of people here on the boards have their payments taken right out of their paychecks, like myself, and after awhile, you never even know what your missing, as long as you stick to your budget
TonkaTruck

This is completely true. The first few months, I had to go to the bank, get a money order, sent it by certified mail, etc. It was painful to have to withdraw the money and send it - it was almost like rubbing salt in the wound.

Now that the wage garnishment is set up (and has been for almost a year now) I barely even notice it. We have learned to live within our budget and to be honest, we are actually doing BETTER financially now in the Chapter 13, despite the payment, that we were before.

[edwards2]

quickteg....I agree with everyone else about your calming down and evaluating your situation. We filed Chapter 7 and our case was discharged in August 2005 so admittedly I dont know a lot about Chapter 13s except that I have read from other posters that if an emergency arises - and of course it always does - that you are supposed to inform your attorney so he can talk to the trustee about modifying your payments even if it is only temporary. I also agree that since you missed one already they apparently have taken the high road and garnished your wife's wages. The bottom line is though it is not the court or trustee's responsibility to call you and let you know what they are going to do or not do. All of that I am sure was covered when you elected to file BK. Filing BK whether it be a 7 or 13 is very stressful but somehow you will get through this...you are already halfway there so dont give up now...this is a bump in the road but there is light at the end of the tunnel(yet another cliche...)...good luck!