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sale of residence in chapter 13 after plan has been fully
>Reply-To: cdcbaa@yahoogroups.com
>To: cdcbaa@yahoogroups.com
>Subject: [cdcbaa] Re: sale of residence in chapter 13 after plan has been
>fully performed.
>Date: Wed, 18 Feb 2004 03:56:41 -0000
>
>Steve:
>
>10, 15 years ago the Hyman case was decided. It is a 9th Cir case
>and held a home, which remains property of an estate, accrues equity
>for the estate, not for the debtor.
>
>You probably have to withdraw the motion to sell and press a motion
>to have the case closed.
>
>dennis
>
Steve and Dennis,
Now I understand Steve's question better. First, if the Debtor has
completed the plan, he or
she is entitled to a discharge.
True the increase in equity belongs to the Bk Estate. But doesn't that only
apply to Ch 7? The confirmation of a Ch 13 plan is like a mini-"cramdown".
Once it's confirmed all the creditors are entitled to is the performance of
the provisions of the plan. 11 USC 1327. If the equity increases to above
the homestead amount can the debtor be forced, based on a new liquidation
analysis, to pay more to class 5? No.
The only equity that belongs to the Ch 7 estate is the equity above the
homestead. Yet the trustee makes the debtor pay creditors when the realized
equity from the home is less than the homestead amount.
One of the purposes of Ch 13 was to allow the debtor extra time to pay
secured debts in order to retain property. So it seems strange that a Ch 7
debtor can compel the trustee to abandon the homestead and then the debtor
can get court permission to sell and will be allowed to keep the proceeds up
to the homestead amount---yet this can't be done in 13??
There's no statutory or case law basis for the trustees current practice
IMHO. Andrew Smyth
The post was migrated from Yahoo.
>Reply-To: cdcbaa@yahoogroups.com
>To: cdcbaa@yahoogroups.com
>Subject: [cdcbaa] sale of residence in chapter 13 after plan has been fully
>performed.
>Date: Sat, 14 Feb 2004 10:00:44 -0800 (PST)
>
>Dear Colleagues:
>
>Please assume the following facts:
>
>Chapter 13 plan is confirmed in the Spring of 2000. 14% plan. I had the
>single family residence appraised as of the filing date before I filed the
>case. There is no equity above
>the homestead exemption. Really!
>
>Debtor has fully performed his plan. 36 months. The trustee did a motion
>to increase the dividend because some creditors did not file. Plan payment
>remained unchanged, so
>creditors who participated got 40%
>
>Client is now in escrow to sell, but we cannot close escrow because the
>trustee has not
>finished her final accounting, and that will take months, etc.....
>
>So, I file a motion to authorize the debtor to sell. I state plan has been
>fully performed, so no proceeds are to go the the trustee or to creditors.
>Trustee's counsel objects on the basis that creditors will not be paid
>100%. House value, of course, has doubled.
>
>Any thoughts for me and my soon to be looking for a new lawyer client?
>
>Steve Burton (818) 501-5055
>
>
>
>---------------------------------
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Dear Steve and colleagues,
As you know whether the trustee has increased the percentage previously or
not---she asks for all the sale proceeds when you seek permission to sell.
This is even true when the proceeds do not exceed the homestead exemption.
The proceeds retain the homestead exemption for six months if the debtor
plans to reinvest. Based on that I think some research should be done to
limit this practice of the trustee.
Andrew Smyth. PS. Ever had the situation where the trustee raises the
percentage to 100% because the plan payment will stay the same---then a
large claim comes in and the trustee moves to dismiss because it is now
infeasable to pay this large claim at 100%?
The post was migrated from Yahoo.