final audit question

[helpsoneeded]

Hi i have about 18 months to go with our chapter13. What happens in the final audit? What exactly is that? Thanks....

[kornellred]

From what I understand, the final audit occurs when the Chapter 13 trustee acknowledges that all payments have been received. All creditors who have filed claims are notified and final distributions of on-hand funds are made. Claimants can file objections to the debtor's discharge if they think that such an action would be possible or appropriate, which in the vast majority of cases it is not. It generally takes between 1 to 3 months to account for creditors responses. You can generally figure on receiving the official Chapter 13 discharge within three months of the last plan payment.

The trustee does not try to figure out how much you have managed to get away with during your Chapter 13 plan.

[TrainWreak]

That's what I don't understand. The creditors had a chance to object at the beginning of the process. What could move them to object at the end?
I was totally up front about everything when I filed and notified my attorney of any changes in circumstances along the way.
My final audit should start this month.
I know it is what it is.

[goon]

My understanding is that this is more about the trustee auditing how THEY handled the money that you sent them during the plan. and at this point objections from creditors would more again more be in how the trustee dived up funds between them. From what I understand the final audit in general really has nothing to do with you, it is all about auditing how the trustee handled the money.

[kornellred]

goon - I think that is a much more accurate assessment of the final audit process than the one that I offered. I will find out soon - I have one more payment to go on my own Chapter 13.

[Carter]

Kornellred, if you could please keep us updated on the timeline of your case. I am curious myself with only 5 more payments left. I am trying to buy a house and the lender is timing everything to close after discharge so that we won't need trustee approval. The lender is telling me not to sweat it that I will be discharged in 30-45 days from last payment but I'm thinking it will be more like 3 months.

[TrainWreak]

My understanding is that this is more about the trustee auditing how THEY handled the money that you sent them during the plan. and at this point objections from creditors would more again more be in how the trustee dived up funds between them. From what I understand the final audit in general really has nothing to do with you, it is all about auditing how the trustee handled the money.

Very good explanation, thank you!

[goon]

Please don't take my word as gospel, thou I am sure if I was off base I would have been corrected by one of the experts by now. I am just a guy in a 13 myself that trys to keep an eye on this forum to make sure I don't get screwed somehow... and occasionally post comments when I have info to share.

Just to add alittle to my original explanation, I believe I have heard of very rare cases where during the audit the trustee realizes that you owe a small amount more money (to my understanding this would only happen in a weird situation where someone got approval to put off of a plan payment or were late on a payment and had secured creditors where interest accrued or something like that ) thou I have also heard of situations where during the audit they see that you should be given some money back (again this would likely be a "weird" situation). But I wouldn't worry about this... I believe it would only be an issue if something happened while payments were still being made to a secured creditor where interest was accruing, and only then if someone screwed up and they didn't talk to you and take care of it earlier (that would be something that should be caught before the audit, I am sure the trustee wants the audit to go smoothly for their own sake) ... the example here would be if you were late with a payment then the trustee would be late with the payment to the secured creditor and additional interest would accumulate so you could be responsible for contributing the amount of that additional interest into the plan.. and if it wasn't caught earlier ( which it would normally be) then it could be caught in the audit

That late in the game the only way I could imagine the creditors bringing up anything that would directly affect you is if they had proof of some kind of fraud on your part. Otherwise they would only be complaining that they didn't get their fair share based on BK rules and if the trustee ended up having to take money from one creditor and give to another it wouldn't affect you directly other than prolonging the close of the case.

p.s. sorry for the typos in my earlier post, I did some correcting and apparently didn't remove all of something....

[Mayo]

I was discharged in April and the final audit is nothing more than them making sure that all the checks are cashed. The trustee after the final audit will send the Judge a motion for discharge saying that you have met all the obligations of your plan. Make sure that you have completed the debtor education course, this will be needed to complete the discharge. You will have some other forms pertaining to child support and alimony that will also need to be filed. It was exactly 90 days from my final payment till my discharge. I found out on Pacer a week before I was notified by mail.

[spidge]

goon, your description triggered a question. I have been paying my mortgage after the first, so could the audit give the mortgage company a way to ask or demand more money even though any interest or possible late fee was not included in the original BK claim?

[goon]

goon, your description triggered a question. I have been paying my mortgage after the first, so could the audit give the mortgage company a way to ask or demand more money even though any interest or possible late fee was not included in the original BK claim?

I don't think so, but I am not sure on that particular question....