Chapter 13 Home Stretch - Questions

[scht65]

Down to 10 months remaining on my Chapter 13 and I have a few decisions to make and my lawyer isn't much help, nice guy but he confuses the heck out of me.

1. My final date is November 1, 2012 does my plan automatically end on that date or as my attorney says after I make 60 payments into my plan? That is only the difference of 2 payments but just curious.

2. He said that I could pay off plan early, by my calculations I will still have about $13K remaining after the end of my plan. If I go for an early payoff would it be the remaining scheduled payments or the total balance of the BK?

3. I have a good opportunity to relocate, now - hence the payoff question, my company would buy my house so I would only need to find new housing is it a problem to find a rental with a BK on my credit report - or - can anyone offer a good mortgage company that is okay for FHA mortgages while in an open 13?

[kiheimer]

no your plan does not automatically end on that date
The last of my debts were paid off on 10-21-11 and I still
have not been discharged or even gotten a final report
they have been paying my house payment the last 3 months
only so now I have over $4,200.00 in my account

[lrprn]

1. My final date is November 1, 2012 does my plan automatically end on that date or as my attorney says after I make 60 payments into my plan? That is only the difference of 2 payments but just curious.

Your plan officially ends when you receive the magic letter from your trustee and the court stating that all payments have been received. Until then, you can ask your lawyer to ask the trustee when the last payment is expected. But until you get official word from the trustee that it's ok to stop payments, you keep making them. Any overages will be refunded by your trustee after the required case audit to ensure all monies have been fairly distributed is completed.

2. He said that I could pay off plan early, by my calculations I will still have about $13K remaining after the end of my plan. If I go for an early payoff would it be the remaining scheduled payments or the total balance of the BK?

We haven't heard of any members able to pay off early in a Ch 13 without being required to pay off 100% of what they owed their non-secured creditors who filed claims. Unless you are in a 100% payback plan anyway, don't count on paying off early.

3. I have a good opportunity to relocate, now - hence the payoff question, my company would buy my house so I would only need to find new housing is it a problem to find a rental with a BK on my credit report - or - can anyone offer a good mortgage company that is okay for FHA mortgages while in an open 13?

Moving before your plan is done is fine - many 13 filers have done so successfully. Renting while in an active 13 almost over shouldn't be an issue, especially if you rent from a private homeowner rather than a corporate housing complex. If asked directly about a bk be honest, but don't volunteer it if no one asks.

However, getting a mortgage company to lend to you while you are in an active 13 isn't going to happen. Most housing lenders won't touch you for at least a year or two after a successful Ch 13 discharge (although there have been rare exceptions noted here in the forums). As I recall, FHA won't lend for at least two years after a bk discharge.

[scht65]

Trying to clarify - I understand that I will need to wait for the trustee's letter but I am trying to understand the trigger for the payments.

Does the trustee look to see how many payments are made at your anniversary of the filing (for me November 2007 / 5 years November 2012) as their trigger, or the amount of payments made into your plan (i.e. 130 payments / 26 yr. - 5 yrs.). When I look at my payment register from the trustee my first payment shows as 1/14/2008 even though my filing date is 11/07?

So does it end at payments made through anniversary date (11/12) or payment date (1/13) after they do their audit of funds etc...

[scht65]

Also - I am in a 100% payment plan, but it looks like their will still be $$$ that I will not have to pay as some of my debt (car loans) that were expected to be paid inside the plan were paid early as secured debts therefor moving some of the un-secured portion back.

[Arbyone]

Q.1 My final date is November 1, 2012 does my plan automatically end on that date or as my attorney says after I make 60 payments into my plan? That is only the difference of 2 payments but just curiou

My A: The final date is when the trustee tells you to stop making any further payments or when you recieve your discharge. You may try to call the trustee office and ask him how many more payments. I called after 2 weeks after they got my 60th payment, and was told to stop sending payments.

Q.2 He said that I could pay off plan early, by my calculations I will still have about $13K remaining after the end of my plan. If I go for an early payoff would it be the remaining scheduled payments or the total balance of the BK?

My A. Pay off early is rare, if you make extra payment during the month the trustee just adds it on as disposable income. After the 60th payment and after they say stop paying thats when it stops. No matter how much more you owe.


Q.3 I have a good opportunity to relocate, now - hence the payoff question, my company would buy my house so I would only need to find new housing is it a problem to find a rental with a BK on my credit report - or - can anyone offer a good mortgage company that is okay for FHA mortgages while in an open 13?

My A. I dont think you would like your employer to know your in chap 13 ? If you plan on selling the house doesn't the trustee need to know it, and if approve to sell it doesn't the profit go to the bk. No lender would touch you without trustee involvement.

I would hold onto the house and move into a rental. wouldn't the trustee need to get involved in the purchase of a new house as you would incure debt while in a chapter 13 ?

I personally would say stall as much as you can so that you can finish your chapt 13 then make the move if it still available.
Sorry,
Arbyone

[Flamingo]

Trying to clarify - I understand that I will need to wait for the trustee's letter but I am trying to understand the trigger for the payments.

Does the trustee look to see how many payments are made at your anniversary of the filing (for me November 2007 / 5 years November 2012) as their trigger, or the amount of payments made into your plan (i.e. 130 payments / 26 yr. - 5 yrs.). When I look at my payment register from the trustee my first payment shows as 1/14/2008 even though my filing date is 11/07?

So does it end at payments made through anniversary date (11/12) or payment date (1/13) after they do their audit of funds etc...

When you make your last payment, contact your attorney and ask what, if anything, you need to do further. Usually what occurs when a last payment is made is that within about a month to six weeks, the trustee will send a letter to you advising what will now take place as to the audit of your plan, etc. The trustee will be sending out final payments and letters to all creditors involved in your plan and those creditors have to send that information back to the trustee that they are paid in full. When all that is in place, you will receive your discharge. Our letter was received about the second week of June in 2006, our discharge came the end of August 2006. Our matter was closed in February 2007. That will give you an idea as to a possible timeline.

[scht65]

Thanks for all the replies!