QUESTION

Do we have a fighting chance at showing feasibility when we will only have 3 weeks’ worth of pay stubs to show?

Asked on Jun 10th, 2016 on Bankruptcy - Michigan
More details to this question:
When we filed our Chapter 13 application, our income on the form was the prior 6 months earnings averaged. However, my husband was unemployed and not receiving an income for the month we filed. The trustee has objected to confirmation due to feasibility. We consented to the objection and have 3 weeks to file an amended plan. Meanwhile, my husband started a new job this week that is working out wonderfully. How will our income be calculated under the amendment and will the judge consider the fact that we now have two incomes to make the plan work? We originally proposed a step-up plan as we were waiting for him to find work. The other wrinkle is that his line of work is purely commission based so it's not a salary we can divide by 12. If the judge does not find the plan feasible, are we dead in the water and out of time or do we have any other options to get more time?
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6 ANSWERS

First things first: you need to retain a skilled BR lawyer who knows the practices in your district. It's almost always worth the effort. Second, step-up plans are disfavored under the eleven-year old Bankruptcy Reform Act. Third, you do have a fighting chance. You will need evidence to respond to an objection at the hearing on it. Prof of your earnings from the beginning of the job through the week of the hearing. Testimony from the supervisor or owner of the business that what you are earning (or whatever is the truth) is typical, or reasonable to expect you to continue earning. and your BR papers will show what your expenses are, and of course the Means Test must show a final number which you can afford, and when added to your secured and priority claims, pays at least the minimum which in your case you must pay. A lawyer generally makes the whole process much simpler.
Answered on Jul 18th, 2016 at 6:34 AM

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Commercial & Bankruptcy Law Attorney serving Powell, OH at Ronald K. Nims
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Of course, a long term stable job history is better evidence that the job will continue for the 3 to 5 years of the proposed plan than a job which was only begun a few weeks ago. However, no job is secure for the next 3 to 5 years (sure, teachers and other non-accountable government employees can't be fired but they can lose their job because of illness or disability or they quit to pursue something else). Now that you have a job, the court will presume that it will last the life of the plan and I've never seen a trustee attempt to dispute that. Once the trustee is informed of the new job, I predict that the trustee will withdraw his/her objection to your plan.
Answered on Jul 13th, 2016 at 5:49 PM

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Sounds like you are doing this without an attorney. I would recommend that you pay an experienced BK lawyer to review your file with you and your options. You should pay for about 90 minutes of their time.
Answered on Jul 13th, 2016 at 5:49 PM

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Bankruptcy Attorney serving Las Vegas, NV
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Amend schedule I and show your current income. Amend your plan to show the new disposable income amount.
Answered on Jul 13th, 2016 at 5:48 PM

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Bankruptcy Attorney serving Las Vegas, NV at A Fresh Start
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The trustee is likely to accept the wage information to overcome the feasibility issue at some point. It might not be unreasonable to have the trustee delay confirmation a few weeks to make sure that this job is secure. Unfortunately, you are asking for assurances from people who do not know who your trustee is and cannot review your paperwork. You take a terrible risk in filing a Chapter 13 without an attorney, because the success or failure of your plan is often based on the personal relationship the trustee has with the attorney representing you.
Answered on Jul 13th, 2016 at 5:48 PM

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Bankruptcy Attorney serving Livonia, MI at Charles J. Schneider, P.C.
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You need to hire an attorney for a chapter 13.
Answered on Jul 13th, 2016 at 9:12 AM

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