August 22, 2014

Can I “Cancel” a Chapter 13 Bankruptcy if I Changed My Mind?

Here is an interesting question I received this morning from one of my former clients. She raises several important points so I thought I would answer it on the blog rather than simply by email.

"My friend signed bankruptcy papers yesterday…she was in a rush. She's filing Ch. 13 with 100% payback because she makes too much money to do anything else, allegedly. Later she found some errors that is making it where what she will pay out on the debts plus regular monthly bills, she pays out more than she's bringing in. Called her lawyer at 6:30 this morning, left a message — DON'T FILE IT, IT'S NOT RIGHT. Called all day and couldn't get anyone. Messages at the lawyer's office weren't listened to until 3 PM — AFTER FILING. Is here a 3-day right of recission for this, or an amendment/revision possibility, or is this something that would be addressed at the hearing? "

My response: There is no "right of recission."  once a case is filed it is filed. She can voluntarily dismiss the case but if she does so any subsequent filing within the next year would be slightly more difficult. In a second case filed within a year, the automatic stay, which is the core protection of bankruptcy, expires after 30 days unless the debtor and her lawyer file a Motion to Extend Stay and convince the Judge to extend the stay because of changed circumstances.

Further, if she is going to dismiss, she should do so soon, before any creditor files a Motion for Relief from Stay.  If she was to dismiss after a creditor files a Motion for Relief from Stay, she would be barred from refiling for 180 days. She can and should sit down with her lawyer and discuss the budget tosee if it can be fixed.  Budgets and plans are amended all the time.

By the way, if your friend had filed a Chapter 7, she would not have the right to voluntarily dismiss.  Chapter 7 cases can only be dismissed if the Court permits.  Chapter 13 cases can be dismissed as of right (unless the Court orders otherwise). 

You have highlighted a couple of very important points.  First, every bankruptcy debtor needs to carefully review each page of his or her petition to check for accuracy.  I think it is also the responsibility of the bankruptcy lawyer to explain exactly what is going to happen and what the debtor must do, but ultimately, the debtor is the one who has to live with the Chapter 13 for the next five years.

Second, when one is sitting in a bankruptcy lawyer's office discussing Chapter 7 or Chapter 13, everything needs to be on the table.  Cars, houses, time shares, furniture – everything.  I have noticed a significant change in the way both the courts and the trustees approach bankruptcy. 

Under the old law, bankruptcy was a kind of financial tool.  Chapter 13 was sort of like Consumer Credit Counseling on steriods – you had the power of the Court in your corner to force creditors to accept a reasonable repayment plan.  Now, bankruptcy is more about pain.  What does it take for you to survive?  Luxuries – and by luxuries I am referring to a car payment of $500 or a house payment of $2000 – may not be acceptable. 

The trustees in bankruptcy now expect you to change your lifestyle and to live under a very basic budget. Bankruptcy consultations now remind me of tax problem consultations.  I am not the reassuring, optimistic counselor that I used to be because I would be misleading my clients if I took that attitude.  Although bankruptcy remains a very powerful tool, the issue is not what you want to do, but can we structure a plan that lets you keep your house or car or furniture.

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Jonathan Ginsberg represents honest, hardworking men and women in the Atlanta area who need personal bankruptcy protection. In practice for over 25 years, Jonathan teaches bankruptcy law and practice at legal continuing education seminars and he is a founding member of the Bankruptcy Law Network. Jonathan lives with his wife and children in Atlanta.
About Jonathan

Jonathan Ginsberg represents honest, hardworking men and women in the Atlanta area who need personal bankruptcy protection. In practice for over 25 years, Jonathan teaches bankruptcy law and practice at legal continuing education seminars and he is a founding member of the Bankruptcy Law Network. Jonathan lives with his wife and children in Atlanta.

Comments

  1. Can I change bankruptcy attorneys after filing? The one I have retained is incompetent and has not provided good advice. I have another hearing in a couple of weeks because we were denied in our first meeting with the judge this morning.
    Thanks
    Jim

  2. Yes, you have the right to terminate your current lawyer and hire a new one. Be aware, however, that in doing this you may have an issue with regard to fees. You don’t say where you live but in many federal districts, bankruptcy lawyers operate under a “no look” fee contract whereby they do not have to keep hourly time. Because a new lawyer would be coming in during the middle of your case, he might not be eligible to get paid under a “no look” fee contract and would be required to keep detailed time records. Most consumer bankruptcy lawyers are not set up to keep detailed time records so your pool of potential replacement lawyers may be small. Before you terminate your existing lawyer, yo may want to sit down with him or her to discuss the issues and try to come to some agreement. Objections are common in bankruptcy cases and it may be that the problems in your case are easily fixable.

  3. Sherril Williams says:

    I filed a chapter 13 in Dec. 2004. my payments are $461.00 bi-weekly. I can’t afford this amount anymore, can I ask my lawyer to get the amount decreased.

  4. my husband and i are 4 months into making chpter 13 payments and can no longer afford to make our payments. We are having to decide on paying utility bills or paying for car insurance, childcare or home owners insurance. We told the attornies that we didn’t see how the means tests said that we can afford $1200 a month over what we are already struggling to pay, but they kept saying “the numbers and the test don’t lye”. we filed in order to keep our house. What happens if we can’t do it anymore? We know we could loose the house, but what kind of timeline are we looking at from the time we say “we quit” until we have to get out of our home? Our cars are also under the plan, can we keep them if we make arrangements with the car company?

  5. cassendra carter says:

    My husband and I are thinking about filing for chapter 13 in Arkansas. WE bought two new cars in the last 6 months. One of the cars we bought was only worth $30,000 but we financed over 45 thousand for it. My husband spoke to an attorney and he advised us to go out and if possible buy another car that we would not be so upside down on before we file. We did this and now have three car notes. The attorney advised us that we would get to choose which cars to keep and which to turn back in at no cost to us. We planned on turning in the one we owed 45 thousand on. I can’t find anywhere that talks about getting to turn a car in. I only find articles that say we have to pay all car notes in full that were purchased within two or three years of filing. Is this true?
    Cassendra

  6. my wife and i have been in our chapt 13 plan for 4 years in illinois we now have enough equity to refi @ a 30 year fha rate of 6.8 % our old mort is 7.5% and is paid out of the plan.we have submitted a good faith estimate for right to refi with proceeds of the refi pay off plan. the paralegal will not forward that is in our best interest until she gets 2 mos payroll stubs. she is being a bitch about it last year she submitted everything without stubs but we reniged because the rates were arm rates. im afraid if something goes wrong theyll make us pay more because our income is much higher than 4 years ago due to promotions.it seems like she is on the other side our payments are 1470 amonth the new mort with every thing escrowed in will only be 1330 amonth with cash out of 25,000 we only need 5,000 to pay off plan please help someone!!!

  7. We filed for chapter 13 in early Dec and proposed plan is at 100%. Our confirmation hearing isn’t until Feb 21, but my question is, my husband has enough money in a money market that we have thought about paying this bankruptcy off in the next few months. Do we have to wait until after the 6 month deadline for all claims can be filed?

  8. If you are in a 100% plan, I don’t see why anyone would object to paying it off early. However, this is a question for your bankruptcy lawyer. He/she should be able to find out if this unusual, early payoff involves any complications.

  9. I filed Chapter 13 in September of 2007, however my payments were set for more than I can afford. My car was included in the payments, but it is currently in the shop and I haven’t got the $400-500 estimate I was given to repair it. I have to get a ride to work every day and may lose my job because the person I ride with recently had their hours changed and now come in an hour later than I am supposed to be there. Also, I really have no money to live on and can barely keep my electricity and water on. I am thinking about getting my Chapter 13 dismissed due to hardship. I am wondering if my mortgage company will work with me.

  10. toni rogers says:

    My case was filed in December. My confirmation hearing is in a month. Do I still have the right to change my mind before that hearing? If so, will the money already paid go to attorney fees?

  11. we have been in a chp 13 for a year- we owe more on our house and two cars than they are worth- my husband has lost his job and we will not be able to make the monthly payments on my pay alone. Are we able to switch from a 13 to a 7 and reaffirm on the two cars and house? what is involved in doing this-we currently live in columbus ohio and the job market is very slim and the housing market is even worse. when we contacted our attorney his only response was “get a job”- I am sure we are not the first couple to be faced with this situation.

  12. I have been in Chapter 13 for over two years and have one year left. Many of my creditors have been paid and they have wrote my loans off as bad debt. I have not given the trustee last years tax returns and they are trying to get my case dismissed. I was thinking, maybe it would be good if they did and I could stop with my payments. Would all my creditors come after me for the original amount I owed them? Could they do anything? My credit is shot anyway, what else can they do?

  13. I have been in Chapter 13 for over two years and have one year left. Many of my creditors have been paid and they have wrote my loans off as bad debt. I have not given the trustee last years tax returns and they are trying to get my case dismissed. I was thinking, maybe it would be good if they did and I could stop with my payments. Would all my creditors come after me for the original amount I owed them? My credit is shot anyway, Could they do anything?

  14. My husband and I have been in a chapter 13 for nearly three years. It occurred to me after reviewing our last statement that we were never going to be finished paying out this coming August. We contacted the trustee to confirm this and were told that yes, we were going to be extended til at least April of 2009 to be completely finished with our repayment plan. This was disheartening to say the least but here’s my main question. With gas prices so high, and a husband who travels 90 miles one way to work (which is the only income in our home so its the only monies available to repay the plan) our expenses for him to get to work have skyrocketed. Obviously he’s not going to quit his job, but the expense of him traveling from our current home to work has doubled in the last three years. Also, we live in the country, where the shipment and transportation costs (a hand me down from gas prices) has now caused even the price of eggs to rise from .79 cents a dozen eggs to 2.99. A gallon of milk three years ago was 2.49. Now, if you are lucky enough to get it on sale, its over 3.99. These are just a few examples of how rural folk are trying to survive at a time like this. My question to you is, considering my three children have now gone from adolescents to teenagers, my fuel expense is doubled, my home owners and car insurances have been cancelled because I have to choose to feed my family of 5 rather than pay those bills on a take home salary of only 1,100 a month after they remove their chapter payments. Can we opt to file for some form of hardship? Do you have any advice since our attorney that handled our case moved with the only explanation being that he has relocated his office out of state due to the economy????? HELP

  15. I am currently near the end of my Chapter 13 bankruptcy. However, I got notice from the Trustee’s office that an amendment was added to my account regarding my vehicle. I received the title in 2007 from this creditor stating “congratulations” you completed all payments. I do not even have that vehicle any longer. Now they are trying to stiff me for more money. Can they do that? My attorney that I currently have is incompetent and the only reason why I am not seeking other counsel is because I am at the end. If would have totally been finished. I did contact my attorny and they told me that they are waiting to speak to the attorney who put that amendment on my account.

  16. My husband had begun the bankruptcy proceedings but he’s still needs to submit some paperwork so the lawyer has not gone before the courts yet. He’s changed his mind and no longer wants to file and plans to work something out with our mortgage lender (the main reason for filing). Will he be able to stop the proceedings without being penalized or is it too late?

  17. My attorney will not return any of my phone calls even though he has been paid for his services (filing my Chapter 13) in Dallas, Texas. I have moved from my home that was included in the bankruptcy but since then I’ve received a notice from the Bankruptcy Courts that my pay back amount will be increasing another 200.00 per month. How do I have my bankruptcy dismissed or converted. I want to terminate my attorney because I’ve left him at least 25 messages over a weeks time, sent him 17 faxes, and have sent hiim a certified mail letter asking him to contact me so I can have my 13 converted to a 7 or possibly dismissed but he still won’t call me. What are my options?

  18. When you file a chapter 13 to avoid the interest you have to pay it in 36 months. If you pay off early then you pay your creditors 100 percent. At least it works like that in the state of WI.

  19. After meeting the means test to file for chapter 7 bankruptcy can a bankruptcy judge include my wifes social security disability monthly payments with my income to determine if we should file for chapter 13?

  20. if you were rushed to file an emergency bk to prevent a foreclosure and you decide not to go through the process and not provide the paper work . Does this still affect your credit for 7 years?? even if its dismissed. can you reverse the filing?? can you remove from your credit report since you decided not to complete the process??

  21. 1) What are the consequences for NOT reporting newly-acquired income (VA disability payments) while under Chapter 13?

    2) Also, are there ways to where someone would not be required to claim this income?

    2) OR If you cancelled your Chapter 13 plan, would you be able to keep said income? If cancelled, what would be required to be done regarding your debtors that where included in the bankruptcy?

  22. bill bailey says:
  23. John, these are questions that need to be posed to your lawyer as you are asking for legal advice.

  24. My wife and I have filed for Chapter 13 Bankruptcy (Jointly filed). Since then we have decided to divorce. We had our initial meeting today with the judge and several things came up that lead me to believe that it would be in my best interest if we both file separately. Is it possible to stop the joint filing and initiate separate filings after the divorce?

  25. Bart, you could hire your own lawyer and move to separate the case into two separate cases. A joint filing is actually considered two separate cases that are administered together for convenience. You could also agree with your wife to dismiss and then each refile or you could dismiss yourself from the joint case, but there are negative implications to a second filing within 1 year of the first. At this point you need to speak to a bankruptcy lawyer different than the one who filed the joint case.

  26. Denise Williams says:

    My husband and i own a small construction business – S Corp – and due to the economy and medical bills filed Chap 13 bankruptcy almost 2 years ago. In order to remain in business we must be bonded. Our bonding company has advised that when our bonds expire in a few months they will not renew, and I’ve been told by our agent that no one will bond if there is an “open” bankruptcy. No bond = no business = no income = no bankruptcy court payments. I have tried contacting our bankruptcy attorney, but he never returns calls and of course has collected his whole fee. I feel like we are between a rock and hard place. He told us we had to pay in for 3 full years – but our bonds will expire before that happens. is this just hopeless?

  27. Angelita K. says:

    Jonathan,
    I filed a chapter 13 with 100% repayment, in Nov. 09 and it was dismissed for failing to make planned payments of $6837.71 per month in Nov. 2011, per my attorney, based on my income, although I was only making a very small amount at the time, and had two units in my building that were not rented. The plan was approved, despite my apprehension because I am still continuing to pay all the bills for the building, my daughter’s tuition, life insurance premiums and renovations on the building, upkeep, violations, etc. I had asked my attorney at the time of filing about the interest rate on the loans. I have three properties and have three mortgages, all of which are over the federal guidelines of what the interest rate should be. I asked him again, when he said he was going in to have the bankruptcy dismissed because I had failed to make three payments. I received the paperwork from Chase just recently for a loan modification, and when speaking to the representative on the phone she indicated that I was 8 months behind in payments? I said that was impossible. I had only missed the last three payments over the past two years. She said no, I see that you have a total of 8 missed payments. Now, I only owe $32,000.00 on this piece of property, $76,000.00 on the other, and my largest is the building I reside in which is $197,000.00. I was making very good money as an Executive Nanny prior to filing the BK, but with the economy, the family I was working for decided that a one person being at home was more conducive than paying me a salary. I have worked here and there, but not stable since then. I have everything rented and the incomes of the building coming in, but the payment has increased so many times, it has literally kept me in the dog house and on edge with ensuring that I have those payment in every month. My questions are this: Can I get a refinance from the lenders for the HEMP which they all say I am qualified and approved for at 2-3% interest rate which would cut my payments in less than half of what I was paying! And, two, can I then refile the chapter 13, with a new plan, for the new amount, after the banks sign off on the refinance papers?

  28. hello, i filed for chapter13 last week the petition just came through. my brother won some money and is willing to lend me 6000.00 to get my bills caught up. can i cancel my bankruptcy now? and am i still liable for his fees? will my credit rating have the bankrupcy on it?

  29. I am at my wits’ end with our bk lawyer regarding my student loans. We are currently in chapter 13 in MT. Both loan companies have told me that my loans are on a “bankruptcy hold” until I am out of bankruptcy although they are accruing interest. Once I am out of the bankruptcy I can then begin paying off the loans. However, our lawyer has designed a repayment plan that forces us to repay ALL of the student loans within 4 years, despite the fact that these are meant to be 10 year loans. Both Direct Loans and Amercan Student Assistance have told me that I do not need to pay the loans as part of the Ch 13 repayment plan, and that it is an arrangement I need to make with the lawyer. Our lawyer has repeatedly told us that we CANNOT eliminate any creditors from the repayment plan. My husband is so frustrated he wants to dismiss our lawyer and handle the case ourselves. That scares me, but I am at a loss at how to deal with this. With the payment plan our lawyer has drawn up for us (4 yearly balloon payments of $39,000 in addition to our monthly payments) we will be forced into Ch 7.

    Under a Ch 7 we would be forced to sell our snowmobiles which are our only means of getting in and out of our home to get to work during the winter months, my musical instruments which I need for my work as a music teacher, sell our cars – only one of which is reliable and both are valued far higher than we could ever sell them for. We would also we forced to sell our alpaca herd – fine with that – they are eating us out of house and home, but no one is buying alpacas – we are trying to sell them anyway. Again, they are also valued far higher than we can sell them for. I almost wish we had never filed for bk. Dealing with creditors was less stressful then dealing with our lawyer.

  30. I am 2 years into my Chapter 13 bankruptcy filing. The Trustee has raised my monthly payments AGAIN. I’ve done the math and there is no way I can make those kinds of payments and still keep up with the house and car payments, food, utilities, etc. I’ve asked my attorney to submit an appeal or whatever and file a list of my current monthly expenses with the Trustee in an effort to get them to reconsider. If that doesn’t work, what are my options? My car payments are $550 a month and I’m upside down…would it be better to just let them repossess the car? I don’t know what to do…it’s like the Trustee WANTS me to fail or something.

  31. Karen, sometimes math and the means test determine what you have to pay the trustee in a Chapter 13. At the same time, you will find that Chapter 13 trustees will demand as much as they can for a monthly payment. This is where your lawyer comes in. If the math calculations say that your case could work at a lower trustee payment, your option may be to take this issue to the bankruptcy judge assigned to your case and let the judge decide if the trustee’s demand is unreasonable. Good luck.

  32. Nancy, I think what you need to determine is whether the bankruptcy district where you case was filed will allow plans that pay student loans directly. Some jurisdictions allow this, but require a 100% dividend to unsecured creditors, others allow it with a smaller dividend, some might allow you to set a payment of the contract payment during the term of the plan, and some don’t allow it at all. If the judges in your district have already ruled that a plan provision that calls for direct payment of student loans is not allowed, then your lawyer could be advising you correctly that it cannot be done. You need to get an answer to this question. Good luck.

  33. Tony, usually you can dismiss your Chapter 13 (although I would strongly suggest that you discuss the implications of a dismissal with your lawyer first) but dismissing it will not remove it from the public record. Your filing will remain on your credit report for up to 10 years. The fee issue is one of contract with your lawyer – at the very least he would be entitled to the fair market value of services actually rendered.

  34. Angelita, you need to consult with an attorney to get specific answers to these questions.

  35. My girlfriend fell behind on her condo payments and also has a disputed judgement against her for$8000 from the HOA. She lost her job and the condo was coming up for foreclosure.
    She met a paralegal who talked her into filing chapter 13 to stay the foreclosure thinking she could then short sell. She would then withdraw her plea.
    I have been advised that even if she withdraws her filling prior to dismissal it will show up on her credit report as a bankruptcy.

  36. Will, that is correct. Once you file a Chapter 13 bankruptcy, that filing will show up on your credit report for up to 10 years even if you voluntarily dismiss your case the day after you file.

  37. My husband & I are in our 50′s and live in Ohio. We filed for Chapter 7 in Jan. of this year. My husband has a 40 hour job and I sell a variety of items on ebay full time and have been doing this for 10 years. I gave our attorney all of the information asked for about my online busness. How much I made monthly, fees, supplies etc. We spoke in depth about what I do.
    We went to the meeting with the trustee in early February and the Trustee ask for my ebay password. (My attorney sent a young attorney to represent us who had been with his firm a few months and whom we had never met) A few days later another attorney (again never met him either) sent us an email after office hours stating they were becoming “increasingly concerned” about our case in regards to my ebay business. The email stated my business was larger than they originally thought. The Trustee was going to monitor my account and wanted a list of inventory, where it is kept, list of money owed to me from ebay or Paypal & how I aquired the inventory.
    After several frantic calls, I quickly got this information together and it took 10 days for my attorney to send it to the Trustee. It has now been 7 weeks and the Trustee has told my attorney he has bigger cases to tend to. Our attorney without our knowledge offered the Trustee $1000. but the Trustee did not respond.
    Now, my question, should we find a new attorney? He has referred to me as impatient and says we don’t want to upset the Trustee. So he thinks we should just wait and let the Trustee make the next move. The stress of waiting and feeling like we’re in the dark is taking its toll on us. But we don’t want to do the wrong thing. We just don’t know what to do. Is this normal and should we be more patient?

  38. My husband and I have been in Chapter 13 Bankruptcy for almost 2 years and have decided that we will talk to our lawyer about dismissing our case. As with all the other questions, our case is similar. We are so strapped that it comes down to the decision of whether to pay our electric (that is usually getting ready to be shut off) or buy food every payday.
    When I called our lawyer to set up an appointment to meet to discuss this, I received our statement from them of the charges that we had accumulated with them in the past 2 years due to questions that we had after the the filing and was told that we would have to pay them off before he would file a dismissal. Our lawyer has received the initial fee for the Bankruptcy filing and all of that through the trustee (we know by logging into our case online) but we did not know that we would be charged for the countless times that we talked to the paralegal due to questions that we had after it was started. We are glad that we found this out now before it got too out of range to pay off. But it makes us wonder how much more is he going to charge to file a dismissal. We are upset about this so my question is can we file a dismissal on our own without our lawyer? If so, how would we go about doing it. Is there a form we can submit to the trustee? Also, our trustee payment is garnished out of my paycheck and when I talked to the payroll department of the company that I work for about stopping it, they told me that they would need something from my lawyer’s office to do that.
    From researching a dismissal, we understand the consequences we will face. Looking at our case we have seen who is paid off and who is not, so we know somewhat of who will be knocking at our door again. Now we don’t want to talk to our lawyer about this because of how much more will be tacked on to our bill with him. Any information would be helpful. Thank you.

  39. I have been in a Chapter 13 bankruptcy for almost 2 years. The payments I have made have NOT been dispersed to my house payment as that is all I had to file on. No car payments, or other secured debts. It came to my surprise recently to find out the bankruptcy judge has pooled the money into an account, now over $30,000.00, which is not interest bearing, and the attorney fees for my mortgage company are more than this now. I want to say heck with it as after 17 years in my home I am “upside down” again! In principal I own around $65,000.00. But on paper I owe $98,000.00 plus late fees on the payments and more of the banks attorney fees. My question is, If I say the heck with it. Take the house. Can I get the $30,000 plus back from the bankruptcy judge “pool” of my money?

  40. George of the Jungle says:

    Chapter 13 is quickly turning into the biggest scam ever perpetrated by two federal judges in Texas in the history of these United States. First off you pay 10% to this magical Trustee and a bunch of money to an attorney. Any extra money you make they get to keep. You are paying a middle man here. I was punished for working two jobs, paying 5 years on cars with 200k miles on them, foreclosed house etc. I am worse off with a Chapter 13 and wish I never filed. If you attempt to do the right thing you are punished and punished for the banks loaning you the money in a false bubble. Divorce etc led to this and loss of income. Long story short…..I think you are better dealing with the companies directly rather than being in a debtors prison for 5 years. And that is exactly what it is.

  41. George, while I am not quite as cynical as you about Chapter 13, you raise a valid point – you can end up paying as much or more than you would if you dealt directly with the creditors. You do have the benefit of the automatic stay, and in some cases you pay less, but I don’t disagree that sometime, Chapter 13 is not the perfect remedy.

  42. Lolita, what you are saying makes no sense to me. Why would the trustee not disburse any money for 2 years? You should speak to your lawyer immediately to get a full explanation. I can’t believe that this is actually the case.

  43. Anna, generally, if a lawyer wishes to charge a fee in a consumer bankruptcy case, he must have that fee authorized by the judge. I don’t know that your lawyer can bill your for hourly time until those fees are approved by the judge. I would take a look at the fee contract you signed with your lawyer and I would also run this question by another bankruptcy lawyer in your town to determine if this billing is appropriate and legal.

  44. Dee, I have never heard of a trustee asking for an eBay password. I know from my experience that trying to negotiate a dispute settlement with a trustee can be time consuming and I agree that you don’t want to harass the trustee. I have been involved in several cases where the passage of time was in my client’s favor. I think at this point you need to get a clear understanding from your lawyer about the scope of the issue. How big is too big for your eBay business. Assuming that your lawyer knew that you had an eBay business, I think you should have been warned about the likelihood that trustee would want to learn about the activity. I don’t necessarily think that you need to get another lawyer, but I do think it is time for a sit-down with your lawyer so you better understand the issues you are facing.

  45. Denise, I wonder if the bonding company might be open to extending a bond if you can get a special order from the bankruptcy judge authorizing the bond. Your lawyer needs to respond to your calls – this is his ethical and professional obligation. Your bankruptcy judge would not be happy to hear that your lawyer is ignoring you.

  46. I file chapter 13 in 2010 and have made all payments. I received a letter from my trustee saying I owe 2009 tax return, my lawyer has not returned any of my calls and he’s the one who told me to send my tax return in starting with 2011. Do have to comply and send in the money I don’t have.

  47. @John, I assume you are referring to your refund, not your return. I had this happen to a client of mine – I filed a motion to excuse repayment, appeared before the judge and explained how the money was used. The judge excused the non-payment of the refund to the trustee. You will need your lawyer’s cooperation and help to do this, however.

  48. At My Whits End in Oklahoma says:

    I filed for Chapter 13 in February of this year separately from my husband. I had acrued a lot of debt without his knowledge and was at the end. After coming clean with my husband and almost ending my marraige over the trust issue, I was told by the attorney that I hired that filing bankruptcy wouldn’t affect my husband. However, his income and all his expenses and everything had to be considered, so yes, it directly affected my and him both tremendously. My attorney was awful. I found that I ended up doing most of his work. He was never prepared for court. My case was finally approved in August 2012. My payment plan of $400 is being deducted automatically from my paycheck each month. My problem is that my attorney has moved out of state and I was unable to contact him for quite some time. He did not notify me he was leaving. I found out through a letter from the trustee that he was trying to still get payment although he had moved out of state! Now, I am worried, as I realized that I hadn’t reported money owed to private people (friends, family, etc.) and didn’t think I could report these. And I had to get a payday loan to try to make some of the payments on these. I am so strapped for money due to the payment plan, and my husband refuses to help me at all since I created this monster. So,I am very worried about this. I am really thinking that I need to just back out of the Chapter 13 and try to work out payments with the million people I owe. What are the implications of cancelling my bankruptcy? Will my creditors be notified and I just contact them to arrange payments? What about the payments I made during this time – do they count? Can they charge me back interest? Help. I don’t know what to do.

  49. Wits:  you need legal advice specific to your situation.  This means that you should find a consumer bankruptcy lawyer who can advise you and possibly take over representation.  I will tell you that it may be difficult to find an attorney to get in the middle of what appears to be a messy situation and you may need to offer to pay an hourly rate for advice.  Don’t be surprised if you have to call around a good bit to find an attorney who is willing to help – Chapter 13 is not designed for multiple attorneys.  I would also put a little pressure on the attorney who filed your case and presumably got paid for it.  I think he has an ethical and professional responsibility to either continue offering legal advice or to associate replacement counsel, and not just leave you hanging.

  50. In a chapter 13 for a year now with 4 years to go. Would now like to divorce my wife but can’t see how we can afford our monthly payments living seperate lives. any suggestions ? Delay the divorce till BK is paid off ? Married for almost 20 years now in California.
    Thank-you

  51. Kevin, while you can separate your case into two cases, doing so can get messy. This is a question that calls for legal advice so you need to discuss with your lawyer. Good luck.

  52. We made 25 payments under CH13 plan. We just found out (Our lawyer didn’t tell us) that when income increases to report to the trustee. I am talking about 20% incrase. What should we do? We are really worried. The increase happened over a year and half ago.

  53. I would talk to your lawyer about reporting the increase and filing a new budget. You could also file a motion to waive most or all of any lump sum that would have been payable had the increase been reported earlier. Bankruptcy Courts are courts of equity and judges have wide discretion in this type of matter. Good luck.

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