Did you receive a “Trustee’s Objection to Confirmation of Plan” for your bankruptcy?
This could spell the end of your case, or it could just be a blip in the road to getting your plan confirmed. If you do nothing at all, it is almost guaranteed your chapter 13 bankruptcy will be dismissed at the time of the confirmation hearing.
Normally, when you file for Chapter 13 bankruptcy and you submit all of your required paperwork while your proposed repayment plan complies with all applicable bankruptcy laws. The chapter 13 trustee will most likely not object to the confirmation of your plan especially if it is a 100% repayment plan. Under these circumstances, it is also unlikely that a creditor would object either. All bankruptcy trustees appear to have slightly different requests. The chapter 13 trustees my firm works with use either http://13documents.com or Epiq Systems. Chapter 7 trustees that my firm have worked with sometimes require hard copy submissions or use either Bankruptcy Management Systems or IQ 7 Exchange. I name all of these systems so that you can see that just because one trustee does something one, it doesn’t mean all of them handle the process the same way.
In New York, there are multiple chapter 13 and chapter 7 trustees throughout the state just as in New Jersey. Which means at times the only way to understand what the trustee wants is by asking them or their staff.
Why did you get an objection to your Chapter 13 Plan?
If you did not use an attorney to file your chapter 13 plan, this is the perfect time to ask an attorney what do you need to get your plan confirmed. Your plan could be missing documents or schedules. The schedules may not be filled out correctly. If you have a house did you provide a Comparative Market Analysis (CMA). A CMA basically is a real estate brokers opinion of what your home is worth. We use First Look Realty for 90% of our New Jersey CMAs. Many times a broker will provide these free of charge if you will list your property with them or in the hopes you will list your property. But, if the CMA does not meet all the requirements of the trustee, the trustee can object to your plan.
Your plan may not make mathematical sense. You may have declared you’re married and then failed to account for your spouse’s income. You may not have provided your proof of income for the last 6 months.
How do you provide proof of income to a bankruptcy trustee?
The proof of income is fairly tricky to understand. The trustees are looking for your last 6 months of income prior to the month you filed for bankruptcy. So, if you file in July and your pay stubs have Year-to-date totals (YTD totals) you would only need to provide the last pay stub you received in June. If you were last paid June 15th or June 30th, that would be the pay stub you would need to submit. Any other month of the year you will need to provide 2 or 3 pay stubs if you worked greater than 6 months. In February through May you need to provide the previous month’s last pay stub, the last paystub of December and the last paystub of the month 7 months prior to your filing.
The 7 month pay stub is what confuses some people. If it is August through January you need to provide 2 paystubs. The last paystub of the previous month and the one 7 months prior. So filing in January, you would provide the December paystub and the last paystub of June. July, August, September, October, November and December are the months of pay to be looked at for the last 6 months. Subtracting all of the YTD pay of June from the YTD pay of December provides that calculation. If you have questions, call us at 973-200-1111 or email us at [email protected].
Derek J. Soltis, Esq., MBA/MS is a New York State Licensed attorney, focusing on Bankruptcy an Foreclosure Defense in New York who has helped many people with defending foreclosure lawsuits in New York.