341 Meeting in two weeks

[lichteda]

I have been in chapter 13 for 2.5 years of a 5 year plan (all current). All claims have been paid at 100% except the Bank who converted a secured claim to a unsecured for 202k after the trustee began closing procedures two years ago. This bank is now trying to aggressively alter the 13 plan to increase my monthly payment because I filed to keep a small bonus and a small tax return. My lawyer (whom I trust) suggested I convert to a chapter 7... I pass the meens test based on my previous income (The chapter 13 Trustee has opened a no-asset case). So there is only one creditor to object against the discharge. I pass the means test. Creditor is very very aggressive. At the time of the conversion I made $112k per year but have 7 dependents; now I am unemployed. (Wife (no income) and 5 younger children) Our 341 meeting is in two weeks. My question... and please be detailed: What should I expect the "aggressive" bank to do? What will their arguments most likely be? Are there good links for me to read up on? I am sure they will file an objection against the discharge. We have no assists that the trustee will pursue liquidation of... We live in Michigan... Thanks for any help, David

[AngelinaCat]

You need to talk with your attorney, whom you trust, and convert to a Ch7. There is no way you can fund a Ch13 while unemployed. As to the bank, I don't know. There is not enough information here to work with. You are at a 100% payback now. What are they wanting?

[lichteda]

Angelina,

The 100% payback under 13 was met BEFORE the bank converted their secured claim to an unsecured. So the 13 trustee distributed about $40k (combination of a bonus and tax refund) to pay all unsecured claims... and began closing the 13 (6 months into the plan). The bank ammended their secured claim to a $202k unsecured and objected to the closing. The 13 Judge ruled that "plan would pay what the plan will pay". Meaning that all remaining 13 payments would go the bank. This was 2 years ago... so all unsecured was paid at 100% except the bank. Sooooo when we filed a motion to exclude 2010 tax refund the bank and the Trustee objected and wanted to rework all the schedules... As such, we converted to a 7 and the 341 meeting is in two weeks. Again, we pass the means test... in fact, we passed the means test 2 1/2 years ago. We were talked into the 13.... it's a money maker!

So I am trying to figure out what the bank can/will object to in the 7. There are no assets for the 7 Trustee to liquidate. I am now unemployeed (but the 7 schedules are worked on my previous income).

This mortage bank has been very agressive and I expect they will try and make some argument... just don't know what to expect???

David

[sunshinepa]

It may be the bank will back off in a CH 7. When you were in the 13, they saw money. If you are a no asset case in the 7, the bank may just give up as they will have to spend money for an objection, could be costly.

Just my opinion and not worth much but I sure hope it works out for you! Best of luck!

[lichteda]

Thanks Sunshine... I sure hope that is the case. My lawyer sure thinks so; but after my experiances in 13 I am very concerned. Only 74 days of hell to find out. Our 341 is on 7/27.

[lichteda]

12 days to our 341... 72 (we pray) to discharge... Still nothing from the mortgage bank! They are the only creditor who will/maybe show up!

One question, when we were in 13 the bank converted their secured claim to an unsecured... The amount of unsecured is a completly fictious number... any chance to object to the "amount" of their claim if this goes to an advisarial hearing?