@kr43002 wrote:
This is not for me, I don't know the full specifics of the case, however my parents are going through a chapter 13.
My father makes way to much money to qualify for a chapter 7, is what I believe is happening.
However his attorney originally filed him for a chapter 7 and it seems as though the trustee is trying to convert it to a chapter 13.
What can be done to lower the monthly payments, or stop it from converting? A large portion of his income is going to be taken, and I am trying to see if there is anyway to avoid it.
In practice, you can't change the monthly payment downwards after you file absent a documented loss of employment income right after filing. Even then it will be a fight because of the means test. Your budget is set based upon the lower of provable receipts or maximums allowed by IRS guidelines for past spending. You must devote all disposable income to unsecured creditors.
If you had a time machine and pre-planned the bankruptcy six months to a year prior, there are some things you can do to decrease the disposable income to some extent to make a chapter 13 easier or squeeze into a 7. What did your dad do with the minimum payments when he stopped paying them? The right answer is spend it on stuff that counts in a bankruptcy budget. It sounds like he spent the minimums on stuff that doesn't count.
When the disposable income is really large which is what it looks like in your parent's case, it's nearly impossible to reduce it enough to squeeze into a 7 absent a bunch of delinquent taxes, a huge mortgage payment, mortgage arrears, and two reasonable auto payments in a joint case. I noticed lawyers don't like helping you very much on pre-planning a BK, but they will answer any individual questions once retained. Given the huge disposable income, it may be necessary to admit defeat and do a chapter 13 while trying to make the 13 easier. Of course everyone wants to be in a 7 instead of a 13. That's not possible if income is way above median for your household and state.
