Topeka's Only Consumer Bankruptcy Law Specialists Now Helping Borrowers with Federal Student Loans
Some rights reserved by NTLamChapter 13 bankruptcy is a powerful tool that may be able to help you end your bill problems. Here are 13 reasons Chapter 13 bankruptcy makes sense written by my Bankruptcy Law Network colleague, Doug Jacobs.
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SURRENDER IN FULL SATISFACTION OF 910 AND PAYMENT IN FULL
WITH NOT INTEREST NOT ALLOWED
In re McClay, Case No. 07-20106
October 2008, Judge Berger
910 vehicle case. Plan provided for payment of full debt with no interest and option to surrender in full satisfaction. This was found to be an attempt to modify prospectively and Court opined that 1329 would have to be used. Court followed 10th Cir. In re Jones, 530 F3d 1284, (10th Cir. 2008). Debtor must pay interest. In re Ballard, 526 F3d 634 (10th Cir. 2008) holds that deficiency must be provided for if vehicle is surrendered. [Read more…]
13 ATTORNEY FEES IN TOPEKA
In re Beck, Case No. 06-40774
February 2007, Judge Karlin
This case should be read in conjunction with the later rendered Professional Fee and Expense Guidelines in Bankruptcy Cases of Judge Karlin. Based upon 330, the evidence and the Johnson factors, the presumptive fee for below the line debtors is $2800 and $3300 for an above the line debtor with $400.00 allowed as additional fees for 363(c) motions, without prejudice to obtaining additional fees by way of a formal application or narrative explanation. Further, presumptive fees for motions ($150.00 plus postage) and responses ($200.00 plus postage) are also established.
22C EXPENSE NOT PERMITTED ON SURRENDERED COLLATERAL
In re Miller, Case No. 07-22927
December 2008, Judge Somers
This decision ties to the concepts enunciated in the various Lanning decisions, i.e., to
what extent may post petition changes in circumstances be considered in determining
what is to be paid by an above the line debtor. Digest by Jan Hamilton, Trustee.
Chapter 13 bankruptcy debtors are responsible for making their plan payments to the trustee.  No excuses.
This is true even if your payments are supposed to be deducted from your paycheck. If no deduction is taken out of your check or if your employer does not remit the money to the trustee, you are still responsible for the payment.
Watch your pay stubs to make sure the payments are being deducted. If not, make the payment yourself and call your attorney to troubleshoot. Your case will be dismissed if payments are not made and you will lose the benefits of chapter 13 bankruptcy.
You can check whether the trustee has received payments by setting up an account with the National Data Center.
Neither Topeka nor Kansas City, Kansas, chapter 13 bankruptcy trustees accept cash nor any kind of electronic bank transfer (ACH transactions). You can set up bill payer service at your bank and arrange for your bank to send the trustee a check if you don’t have employer pay. The Topeka trustee has an electronic payment service provided by a third party.
A Topeka, Kansas, consumer bankruptcy case is pending in the U.S. Supreme Court. It involves the Topeka chapter 13 trustee objecting to Stephanie Lanning’s bankruptcy plan.
Lanning had taken a buyout and left her job at Payless Shoesource. She was working at Joann’s Fabrics for less money when her bankruptcy was filed.
When Lanning took the bankruptcy means test, the Payless buyout caused her income average to be higher than her current income and higher than the median for a single person in Kansas. She would have been required to make a bankruptcy payment she could not afford to make with her lower income. [Read more…]
MORE LINE BY LINES OF B22C
In re Hays, Case No 07-41285
April, 2008, Judge Karlin
13 Trustee objections to debtor’s attempts to claim living expenses for non-dependent debtors as well as for secured debt on a timeshare. Court followed Law and disallowed adult child expenses. The Court allowed the debt on the timeshare to be deducted. The decision is very thorough and is a recommended read.
Digest by:Â Jan Hamilton, Trustee
B22C CASE, LINE BY LINE…
In re Law, Case No. 07-40863
April 2008, Judge Karlin
Court sustained 13 Trustee’s objection to confirmation as debtor included: adult son in household size, tax levy on Line 33 and duplicated it on Line 49 and unencumbered vehicle on line 28. The decision is a good analysis of the status of B22C case law as of the date of the decision.
Digest by:Â Jan Hamilton, Trustee
OK FOR CHAPTER 13 DEBTORS TO TAKE B22C DEDUCTION FOR FULL PAYMENT
RATHER THAN CRAM DOWN AMOUNT
In re Allen, Case No. 07-41327
February 2008, Judge Karlin
Objected to confirmation on the basis that Debtor’s means test calculations erroneously included the full amount of the pre-petition car payments rather than the reduced or crammed-down amounts. In analyzing 1325(b)(1), the Court found that 707(b)(2)(A)(iii) applies and that Debtors need not only list the amounts they will actually pay through the plan. There is a split of authority on this important issue. This case was not appealed so no appellate decision is in the immediate future for the 10th Circuit. See the Hoss and Arroyo decision by Judge Nugent for the opposite result.
Digest by:Â Jan Hamilton, Trustee
A Florida debt adjuster sent letters to Chapter 13 bankruptcy debtors in Kansas falsely telling them that their bankruptcy cases were dismissed and to call right away “to discuss the terms of your dismissal.” What a scam!
These letters from First American Debt Solutions are absolutely FALSE! The bankruptcy cases are NOT DISMISSED! These letters are outrageous! They frighten vulnerable consumer debtors and cause panic. Debtors are tricked into thinking they are no longer protected by the bankruptcy stay against collection.
If you receive one of these outrageous letters, call your bankruptcy attorney right away. She can assure you the letter is false, your case is active and you are still protected by the automatic stay. She will want the letter and mailer to save as evidence against this company. This fraudulent activity have been reported to the Chapter 13 Bankruptcy Trustee, the U.S. Trustee and the Office of the Kansas Bank Commissioner.
Here is part of one letter two clients got this week: [Read more…]
CAR DEDUCTIONS ALLOWED EVEN THOUGH NO LIEN
In re Thomas, Case No 06-21108
In re Camacho, Case No. 06-20729
October 2007, Judge Berger
UST Motion To Dismiss under 707(b) for presumed abuse based upon totality of circumstances was denied. The Court concluded that the debtors are entitled to claim vehicle ownership for expenses, even though debtors did not have liens or leases on the vehicles. (See In Re Howell, 06-11652 for opposing view from Judge Nugent.). Judge Lungstrum subsequently reversed and remanded Thomas, 382 B.R. 793 (D. Kan. 2008).
Digest by:Â Jan Hamilton, Trustee
PLAN MAY NOT PROPOSE EARLY PAYOFF BUT 1329 MAY ALLOW POST
CONFIRMATION MODIFICATION
In re Kidd, et al, Case No. 06-41232
August 2007, Judge Karlin
The Court recognized changes in 1324(b)(4) and held that debtors may not propose an early pay off but may obtain the same in the right circumstances via 1329.
Digest by:Â Jan Hamilton, Trustee
BELOW MEDIAN MUST RUN 36 MONTHS, B22C IS TEMPORAL
In re Daniel, Case No. 06-20714
December 2006, Judge Somers
In a Below Median case, debtor’s income is determined by B22C and expenses by Schedule J and must “run†for 36 months (The Applicable Commitment Period) or pay 100% of all allowed unsecured claims. B22C is temporal, rather than a multiplier. Read carefully.
Digest by:Â Jan Hamilton, Trustee
B22C CONTROLS, OR IF DEBTOR USES I AND J, MUST HAVE A FIVE YEAR PLAN
In re Beckerle, Case No.06-20572
April 2007, Judge Berger
ACP is a time frame of either 3 or 5 years and not a multiplier. B22C is a starting place in determining projected disposable income to be received in the 5-year period. A negative number on B22C indicates the plan is not feasible. Debtor can’t have it both ways. If the debtor relies upon I and J to prove feasibility, then the debtor must commit to a 5-year program.
Digest by:Â Jan Hamilton, Trustee
