DetailsGuy
New Member
My jurisdiction is: California
Does the trustee have any requirement on how the calculation of the mortgage payment is made which would be included into the determination of disposable income?
Presuming sufficient income is available, the debtor (me) wants to use a HIGHER mortgage payment than has historically been made by me over the last 24 months. It is beneficial to me and to the plan to do this. Here is why I believe this to be true:
The mortgage loan is a neg am loan. The mortgage contractually provides for 3 payment options to me.
#1 is minimum payment $1,900/mo<<<This is what I have usually been paying last 24 months
#2 is "Interest Only" payment $3,300/mo<<<This is what I WANT to pay
#3 is fully amortizing 30 year payment $3,600/mo
If the neg am payment #1 is "forced" into the calculations, the loan WILL FOR SURE adjust in about 2 years, which is 3 years before the workout plan would be completed. The payment spike would be huge, and would 99% kill the workout plan, foreclose the house, the whole enchilada.
If the trustee will (or can) allow the mortgage payment to be allowed at the $3,300 Interest Only payment, then the automatic reset of the mortgage will be prevented, and the 5 year workout will probably be completed with no hang ups.
The negative impact to this theory is that the other creditors included in the repayment plan, will receive less money in the 5 years because of the lower discretionary income available that comes with allowing the higher mortgage payment.
On the positive side, the trustee has allowed a plan that will keep 1 more house out of the foreclosure mess for at least 5 more years.
Does this make any sense at all? Am I crazy?
Here is the law that I think applies:
From Section 707
(I) the total of all amounts scheduled as contractually due to secured creditors in each month of the 60 months following the date of the petition; (My comments: if the lower payment is used, the contract (mortgage note) WILL require the payment to increase substantially about 2 years into a 5 year plan)and
(II) any additional payments to secured creditors necessary for the debtor, in filing a plan under chapter 13 of this title, to maintain possession of the debtor's primary residence, motor vehicle, or other property necessary for the support of the debtor and the debtor's dependents, that serves as collateral for secured debts;
divided by 60.
My comments: Seems to me that (I) is allowed because the contract DOES include the higher payment as an option, and
(II) applies because the trustee has a duty to include in the plan the provision for to maintain possession of the debtor's primary residence, motor vehicle, or other property necessary for the support of the debtor and the debtor's dependents, that serves as collateral for secured debts
What do you think?
Does the trustee have any requirement on how the calculation of the mortgage payment is made which would be included into the determination of disposable income?
Presuming sufficient income is available, the debtor (me) wants to use a HIGHER mortgage payment than has historically been made by me over the last 24 months. It is beneficial to me and to the plan to do this. Here is why I believe this to be true:
The mortgage loan is a neg am loan. The mortgage contractually provides for 3 payment options to me.
#1 is minimum payment $1,900/mo<<<This is what I have usually been paying last 24 months
#2 is "Interest Only" payment $3,300/mo<<<This is what I WANT to pay
#3 is fully amortizing 30 year payment $3,600/mo
If the neg am payment #1 is "forced" into the calculations, the loan WILL FOR SURE adjust in about 2 years, which is 3 years before the workout plan would be completed. The payment spike would be huge, and would 99% kill the workout plan, foreclose the house, the whole enchilada.
If the trustee will (or can) allow the mortgage payment to be allowed at the $3,300 Interest Only payment, then the automatic reset of the mortgage will be prevented, and the 5 year workout will probably be completed with no hang ups.
The negative impact to this theory is that the other creditors included in the repayment plan, will receive less money in the 5 years because of the lower discretionary income available that comes with allowing the higher mortgage payment.
On the positive side, the trustee has allowed a plan that will keep 1 more house out of the foreclosure mess for at least 5 more years.
Does this make any sense at all? Am I crazy?
Here is the law that I think applies:
From Section 707
(I) the total of all amounts scheduled as contractually due to secured creditors in each month of the 60 months following the date of the petition; (My comments: if the lower payment is used, the contract (mortgage note) WILL require the payment to increase substantially about 2 years into a 5 year plan)and
(II) any additional payments to secured creditors necessary for the debtor, in filing a plan under chapter 13 of this title, to maintain possession of the debtor's primary residence, motor vehicle, or other property necessary for the support of the debtor and the debtor's dependents, that serves as collateral for secured debts;
divided by 60.
My comments: Seems to me that (I) is allowed because the contract DOES include the higher payment as an option, and
(II) applies because the trustee has a duty to include in the plan the provision for to maintain possession of the debtor's primary residence, motor vehicle, or other property necessary for the support of the debtor and the debtor's dependents, that serves as collateral for secured debts
What do you think?
