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Concern over chapter 13 proposed payment amount

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Hello, I just filed for a chapter 13 but I am really concerned about being able to make the proposed payment, approx $1800 a month. Meeting with trustee is over a month away. I actually retained a lawyer back in October and paid his fees by Nov. 1, but he didn't file until a week ago when I got garnished and we "rushed" through the paperwork to get things filed that day. When I had time to look over the plan that night I was really concerned about the proposed payment - he had originally estimated $1200-1300 a month, not even close to $1800.

I raised my concerns with him and he answered back yesterday that he already filed the plan and he thought it was fine, also implying that there was nothing I could do to change it.

I am worried because I will have several big ticket repairs coming up in the next year or two such as new car tires, new roof on house, new a/c and furnace. Also have a lot of dental work I've been putting off because of bills. There is no amount built into the plan to allow for repairs of what I thought were essential items. All items I listed are either failing or past the time they should have been replaced and could fail at any time. The lawyer knows I have these repairs that need to be done.

I thought the system would allow you a small amount each month to save for these kinds of things? Going over the numbers my secured debts will be paid of course, and with my monthly payment plus yearly tax returns the unsecured creditors will get >80% of what is owed to them. More than double what they would have gotten if I had filed for a chapter 7, which I don't qualify for. I have went over the numbers in the plan multiple times, there's not even in money allotted in there for me to buy lunch once a month, seriously not even $10 for that.

I just don't know what to do, my lawyer seems dismissive and I can't afford to hire another. If I can't make the payments my case will be dismissed and I will be worse off than when I started this because I will have 2 months of late fees added to my debts plus the lawyers fees lost.

Any advice?




You need to have a bit of faith. There is a reason why your attny set your payment at $1,800 per month. He/she did this because 1) your average monthly budget states this is what you can afford to pay OR 2) you need to pay no less than $108,000.00 (1800x60) to pay back what is required by law.

The court understands that you may have "unanticipated" expenses over the next five years. You will have the ability to ask for a grace period to provide for payment of those expenses. It is called a "motion to waive payments" or a "motion for moratorium". However, once the waiver is over your Plan payment may increase to cover the missed payments.

It appears from your post that you are scared. Don't be. This is a process that, for many, works just fine. You, as the debtor, should be given the opportunity by your attny to understand the process. Therefore, if you have questions contact the attny and meet with him/her to go over your concerns. Do this as a "face-to-face", not over the phone or by email. For a start you want to know why your payment has been set at the higher amount. Was it because the budget shows that is what you can afford or was it because of the amount you need to pay by law over the life of the Plan? Once you understand the issues you will be able to either accept the final outcome or get the attny to adjust things to meet your needs.


Des.

Sub: #1 posted on Sat, 01/04/2014 - 07:44

despritfreya despritfreya

(Posts: 162 | Credits: 75.17)

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