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If you come into a large sum of money after you file for Chapter 13 bankruptcy are you liable to tell the trustee about it?
Wiki User
∙ 18y ago
This is tricky but can be answered easily. All depends on wether trustee has access to your Income tax report. if he\she doesn't, then they probably won't be the wiser and my suggestion would be don't tell them, hide it in a sock or under your pillow. Be careful about depositing the money b\c the trustee may be able to see current balances and have acces. In conclusion, I don't think the trustee will be doing these types of things unless you stop monthly payments to them in a structured repayment that has already been put in place. But you could use the money to repay percentage required by trustee. After all there not asking you to repay 100% are they? Only a small percent. Pay it off and be done with it. Tell them you borrowed the money from a relative.
Wiki User
∙ 18y ago
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How does a bankruptcy trustee investigate a debtor?
It is rare that a bankruptcy trustee really investigates a debtor. There have to be a large amount of questionable assets or, like in a Chapter 11, types of assets that would send a trustee to your house. When they do, they look into bank accounts and physical assets such as furniture, houses, cars and even clothes.
Can you receieved a large settlement payment after you are discharged from a chapter 13 bankruptcy?
You can, but you may have to turn it over to the trustee if you did not list the claim in your list of assets and your Statement of Financial Affairs. If the trustee abandoned the claim, the settlement is yours. If you failed to list it, not only can you lose the settlement, you may be subject to federal criminal charges for lying on your bankruptcy forms, which you signed under oath.
What Are Chapter 13 Bankruptcy Exemptions?
Although most debtors keep all their property after filing a Chapter 13 bankruptcy, debtors must file exemptions when applying for this type of bankruptcy just like they do when they file for Chapter 7 bankruptcy. Filing exemptions in a Chapter 13 bankruptcy is for the benefit of creditors rather than the debtor himself. The exemptions inform the creditor of how much she is entitled to and allows her to compare the settlement of the case with the settlement the creditor would receive if the debtor filed Chapter 7 bankruptcy instead.Best Interest of Creditors TestU.S. bankruptcy law requires Chapter 13 bankruptcy applications to pass the "best interest of creditors test." Creditors involved in a Chapter 13 bankruptcy must receive at least as much from the bankruptcy as they would if the debtor filed Chapter 7 bankruptcy instead. The bankruptcy trustee performs this test by deducting the debtor's exemptions from the full value of the estate to determine how much the estate would be worth if the debtor filed Chapter 7 bankruptcy. Creditors may receive more from Chapter 13 than they would from Chapter 7, but they may not receive less from Chapter 13.Determining Payment AmountChapter 13 exemptions, or more specifically, the best interest of creditors test, are also used to determine how much the debtor must pay over the lifetime of the plan. To make this determination, the bankruptcy trustee compares three numbers. The best interest of creditors test, or the non-exempt value of the estate minus administrative costs, is one of these three numbers. The total amount of priority claims, such as alimony, child support and back taxes owed, is another number the bankruptcy trustee looks at, as is the debtor's disposable income, or income after payroll taxes each pay period. The bankruptcy trustee takes the biggest of these numbers and divides it by the life of the plan to determine how much the debtor must pay each month.ConsiderationsChapter 13 bankruptcy may be attractive to some debtors because debtors are at low risk of losing their property through this arrangement and there are no income limitations on this type of bankruptcy. However, debtors cant file for Chapter 13 bankruptcy if they have such large exemptions that the bankruptcy will fail the best interest of creditors test. In addition, Chapter 13 bankruptcy negatively affects the debtor's credit for seven years and requires debtors to pay the bankruptcy trustee on a monthly basis.
Can you sell your home during a Chapter 7?
In most cases you can, I had this same issue filing a chapter 7 and someone wants to purchase my home, I contacted my bankruptcy attorney and he said as long as there is not a lot of equity like $4000 or less than it is ok, but the trustee will be notified. I would advise anyone to wait if you have a large amount of equity.
Does a chapter 13 bankruptcy trustee increase your monthly payment if you get a higher paying job?
Not usually. Once the plan is approved, that's it. There are 2 usual exceptions, if you inherit a large amount or win a lottery. Tax refunds, which are not employment income, often have to be sent to the trustee. It will shorten your plan completion time.
If you receive a large sum of money before your chapter 7 bankruptcy discharge does it need to be reported?
Yes, even for 6 months after discharge. Depending on the source of the money, the trustee may have no way to take it, but not reporting it will leave you open to challenge later on. Ask your lawyer or get an experienced bankruptcy lawyer.
How do you file a bankruptcy?
You would first want to find an attorney to represent you, then start referring creditors to the attorney. Then file-or if you have a lawyer, he or she will do it-a bankruptcy petition for whichever chapter you have decided on/qualify for. Then you will meet with all of your creditors, your attorney, and possibly a bankruptcy trustee. If you are filing on your own, you will want to do a large amount of research on how to go through this process. The article below goes into more detail on the process.
What if the chapter 13 is dismissed?
By law, the debtor has a maximum of 30 days to begin the payments. Even if the plan is as yet unconfirmed by the court, the debtor must begin. If any adjustments to the plan occur later, the payments must be adjusted. Now, we come to the scenario: what happens if a payment is missed?The court can dismiss the petition. The debtor loses the automatic stay. The creditors can begin collection procedures. The creditors can foreclose on loans. The creditors can request account seizures.By law, the debtor can petition the courts to maintain the bankruptcy, or re-file (at debtor cost). But, as always, communication, communication, communication is the greatest tool a debtor has with his or her lawyer and the trustee. As soon as the debtor knows that a payment to the trustee is going to be missed or fall short in amount, the debtor must contact both the lawyer and the trustee. The debtor will do well to have a plan to catch up very quickly. Does the trustee have to accommodate the debtor? Not in the least. Might the trustee somehow accommodate the debtor? Yes. Debtors must realize that the trustee is obligated to the courts for exemplary execution of assigned tasks. The trustee is NOT on the debtor's side. Again, here is where the trust meets reality. The debtor submitted and agreed to the plan. Failure is really not an option.No Matches Found. Please try your search again.More On This TopicWhat happens if I get a raise at work during a bankruptcy?Will Social Security Disability benefits be considered income in a bankruptcy plan?How long do I have to live in my house after filing bankruptcy?Can I File a Civil Suit Against Someone Who Filed BankruptcyDoes Filing Bankruptcy Release You From a Small Claims Judgment?What is a Mortage Cram Down for Rental Properties?Can a Consent Judgment be Wiped Out in Bankruptcy?Are the fees I paid my bankruptcy lawyer and trustee tax deductible?When A Company Files for Chapter 11 Bankruptcy Court Protection What Happens to the Stock?If a company files bankruptcy, will you be given unemployment benefits?Related Legal TermsCHAPTER 7, BANKRUPTCY, CHAPTER 13, INDEFINITE PAYMENT, CHAPTER 11, IMPUTATION OF PAYMENT, CHAPTER SEVEN, INVOLUNTARY BANKRUPTCY, ADJUDICATION OF BANKRUPTCY, CASE DISMISSED Writing Off or "Charging Off" Your Second Mortgage & Putting it into BankruptcyGetting a Large Personal Loan When Having Bad CreditComments are closed.Featuring Black's Law DictionaryBlack's Law Dictionary For MobileRelatedWriting Off or "Charging Off" Your Second Mortgage & Putting it into BankruptcyCan My Ex-spouse File for Bankruptcy After Our Divorce?Can a DUI Conviction Affect You After Moving to a Different State?How To File Taxes When Separated or DivorcedDoes Unemployment Income Count In a Bankruptcy Case?Getting a Large Personal Loan When Having Bad CreditDisclaimerLaw Dictionary: What Happens When Chapter 13 Bankruptcy is Dismissed for Non-Payment?
Can you file a chapter 11?
Yes, provided you meet the qualifications. Bankruptcy is a federal court process. It is designed to help consumers and businesses eliminate debt or repay debts under the protection of the bankruptcy court. Chapter 11 bankruptcy is a type of reorganization bankruptcy, like Chapter 13. Chapter 11 is available to individuals, corporations, and partnerships. It has no limits on the amount of debt, again, like Chapter 13. Chapter 11 is the typical bankruptcy choice for large businesses seeking to restructure their debt and become profitable again. Chapter 11 is the most flexible of all the bankruptcy chapters, which makes it generally more expensive to the debtor. The rate of successful reorganizations is very low.
What are the different types of bankruptcies?
Four. Chapter 7 BK is a total liquidation of debts and available to individuals and businessess. Chapter 13, is a consolidation/repayment action and available to individuals and small businesses. Chapter 11 is a consolidation/repayment action and used by large businesses/corporations. Chapter 12 is a consolidation/repayment action used by farmers and private individuals in the fishing industry (fishermen/women).
If you are entitled to a large inheritance right after bankruptcy how much can the trustee take?
Your bankruptcy trustee has the right to receive your share of the inheritance within 6 months of filing your case. The trustee has the right to receive it all. Typically what happens though is the trustee receives the full amount and then makes a determination of how much is needed to satisfy your estate and debts. If you receive more than is necessary to pay off your debts, you will get a refund. It can take some time though. In rare cases, the trustee may have you cut a check for the amount and you keep the difference. But normally trustees don't trust debtors to do this.
How much does the bankruptcy trustee get paid out of settlement?
The amount does vary, but is very regulated by the UST and it is very fair to say that being a trustee is not a very well paying job. The exception of course may be when he is handling a very large case with lots of non-exempt assets to administer. This is the person who administers Chapter 7 cases. His role is to determine whether there are assets to liquidate; to review claims of exemption and the debtor's entitlement to a discharge. He is essentially a representative for the creditors as a group. He is appointed by the United States Trustee, an officer of the Department of Justice, who oversees his performance. He is not himself a government employee. Trustees are frequently lawyers or accountants. The trustee presides at the first meeting of creditors. He can file objections to claims of exemption or oppose the debtor's discharge, but he doesn't decide those questions. The judge decides disputed questions. More on role of bankruptcy judges. Trustees are paid in part from the filing fee paid to the court at the commencement of the case. Any compensation they receive above that is a fee based on the money they handle as part of the estate. If there are no funds in the estate at the end of the day, the trustee gets only his $60 per case. The Chapter 13 trustee is also a private individual appointed by the UST. He serves the same review function as a Chapter 7 trustee (that is, read the schedules and see if the case complies with the Bankruptcy Code and oppose matters that don't comply with the law.) He also serves as the disbursing agent for payments made by the debtor into the plan. Usually,one Chapter 13 trustee serves all the cases in his/her division or district. The trustee gets a small percentage of the funds that flow through the Chapter 13 case. That percentage is fixed by the UST after review of the Chapter 13 trustee's operating expenses. This trustee is a government employee whose job it is to appoint and oversee the Chapter 7 and Chapter 13 trustees. The UST has standing to appear before the court as an interested party. UST is charged with reviewing Chapter 7 cases for abuse or denial of discharge. Since the '05 amendments, they appear to be more active in this oversight role and more aggressive in trying to force cases into Chapter 13. They also take an oversight role in Chapter 11 cases, especially where there is no creditors committee.
