Chapter 13 Questions

[cz3ch]

I just converted to a C13 and had a few questions regarding my payment plan.

1.) I'm going through a divorce (pending) and I have 50% community property interest on the wife's car that has 10k equity in it. From what I've read if I can't exempt that equity I'd be on the hook for 5k of it over 60 months in my plan. What happens if my NDI does not meet the 5k / 60 months? Will the C13 try to sell my wife's car?

2.) Similar question. My wife has a second car which I've been driving and paying the note on directly. This makes it a community property with about 1500 in equity. Would this be handled the same way by taking 50% / 60 months?

3.) I read the sticky by HHM regarding % of plan. Let's say I end up with $7,000 in non-exempt equity and my NDI is x. How would the payment plan work? Would the trustee go for the bigger number (either the non-exempt equity value or NDI) or is it combined? If it is combined and my plan shows that it's not affordable will they dismiss my C13 case, sell assets, or?

Thanks in advance.

[LadyInTheRed]

3.) I read the sticky by HHM regarding % of plan. Let's say I end up with $7,000 in non-exempt equity and my NDI is x. How would the payment plan work? Would the trustee go for the bigger number (either the non-exempt equity value or NDI) or is it combined? If it is combined and my plan shows that it's not affordable will they dismiss my C13 case, sell assets, or?

The payment for non-exempt equity is not in addition to your disposible income. You must show that you have enough disposible income to pay at least that amount to the unsecured creditors. If your plan doesn't do that, the trustee will object to confirmation. As I said in another thread, I am not certain, but I don't think the Chap 13 trustee liquidates non-exempt assets. You and your attorney have to figure out how to come up with a feasible, confirmable plan. If the liquidation of assets is necessary to do that, I think that would be part of the plan. But you would be the one to sell the asset and turn the non-exempt portion of the proceeds over to the trustee (see 11 USC § 1303 which makes me more confident in my statement that a Chap 13 trustee does not liquidate assets).

[cz3ch]

Ok thanks. If the trustee objects to confirmation does the case get dismissed? I'm just not sure what happens next if that situation presented itself.

I meet with my attorney tomorrow to work on my plan and get my DMI where it needs to be.

[justbroke]

The case does not get dismissed unless you (and your attorney) lose the objection AND do not resubmit a plan that adheres to the findings from the order sustaining the Trustee's objection . In other words, losing an Objection to Confirmation of Plan is not a dismissal. It provides the opportunity to make changes to get the plan actually confirmed.

If you choose, after have a sustained objection to confirmation, to just let the case automatically dismiss, then it would be dismissed after so many days.

[cz3ch]

Ok that makes sense, I just thought it might reconvert to a 7 for some reason. Thanks for the info, JB.