Early Payoff

[mbass01]

Does anyone know that if you have only like 5 months left in a 5 year Chapter 13 if you send them the remainder of what you owe them will they discharge you early?

[mountanddo]

I wouldn't do that. Chapter 13 isn't a loan where you pay a certain amount and then you are cleared. All your DMI is supposed to go towards paying off your creditors. If you did that it might raise some red flags. See what other folks have to say, I may be wrong.

[mbass01]

Yeah that is what I was thinking. The thing is it is only a few hundred dollars, not like a thousand or more.

[mountanddo]

You sound like your payment was about as much as mine is going to be at $100/month. Since your DMI is so low weren't you under median? Wondering why you weren't in a three year plan vs five?

[mbass01]

I have no idea. I have never quite understood this whole process. All i have understood is that is has been long and painful. What a punishment.

[justbroke]

Never ever send in unsolicited money to try to "pay off" a Chapter 13. Even some attorneys have done this wrong and all the debtor did was to give the unsecured creditors more money. Unless you're in a 100% plan, you need to work through your attorney and the Trustee's office to determine "if" the ability for an early payoff is even available in your District.

[tigergem]

Right. If you are under median and not required to be in a 60 month plan, you CAN modify the plan to reduce the number of months and increase that last payment or two to pay it off early, in some sort of fashion. But that process takes a couple of months, as well, so you might as well ride it out.