Frequently Asked Questions

DEBTORS

How can I change my address or employment information?
To change an address for a case, submit the change in writing with your signature the updated information. Provide the old address and the new address with your case # and name.

To change the employer information, submit the change in writing with your signature the new employer name, address, city, state, and zip code. ALL CASES ARE REQUIRED TO BE PAYROLL DEDUCTION.

I filed a 36-month plan. More than 36 months have passed. Why must I continue to make payments?
For many plans, the original "plan length" is only an estimate. The actual length can be affected by plan modifications, the addition of debts, missed or partial plan payments, refunds to you, claims filed in excess of your estimates, interest, additional attorney fees, or other factors. Ultimately, your plan is not completed until all the claims provided for in the plan have been paid. The Trustee can provide an estimate of the remaining term, but you may have to consult your attorney to understand precisely why the plan hasn't yet ended.

What must I do to sell my home?
Once you file a Chapter 13 case, all your property becomes "property of the bankruptcy estate." Ordinarily, this means that you cannot sell any property without permission of the Bankruptcy Court as long as you are in Chapter 13. You should never attempt to sell property without consulting with your attorney as to the advisability, legality and mechanics of such a sale.

My case is nearing completion. How will I know when to resume making my mortgage payments directly?
When your case is completed, we will notify you in writing, by mail, regarding the date you are to resume payments, as well as the mortgage company address to which the payments should be sent.

When my plan is completed, how will I get my car title from my lien holder?
Most lien holders can be depended upon to promptly release their liens and turn over the titles they have retained. However, if more than 30 days lapse after the granting of your discharge and you still have not received the title, you may ask that we send the lien holder a letter asking that you be sent the title. If the title is still not forthcoming, you should contact your attorney for assistance.

When is my payment due?
The law requires that payments be commenced no later than 30 days after the date your Chapter 13 petition was filed. Thereafter, they must be regularly made within each succeeding calendar month to be credited for that month. In order to guarantee credit during a particular month, a payment should be received before the end of the month. Payments must be mailed to the Trustee at P.O. Box 279, Memphis, TN 38101-0279.

Can my payment be lowered or may I skip or postpone a payment?
Your required plan payment cannot be lowered by the Trustee; the plan payment can be lowered only by a formal modification of your plan filed by your attorney and approved by the Court. Also, the Trustee has no authority to allow you to skip or postpone a plan payment.

Why did my payment change?
The change may have resulted from the terms stated in your plan, or a modification of your plan. Normally, the change can be explained by either your Attorney or the Trustee's office.

Is it possible to make credit purchases, i.e., accrue post petition debt, while I/we are in Chapter 13 bankruptcy?

Yes. The procedures for doing so are as follows:

1. Contact the Trustee's office for a loan application ($1500.00 or less). Complete the application and return it to the Case administrator assigned to review and submit for approval. If approved, the Trustee will issue an Approval Letter to the creditor will be mailed to you.
   Under certain circumstances your failure to obtain permission may affect the right of a creditor to file a claim in your case, as well as your right to treat such claim as a part of your bankruptcy. That is why creditors often refuse to extend credit in an active Chapter 13 case unless the Trustee's advance permission has been obtained.
2. Real estate debt; commercial debt; and relatively large debts (over $1500.00), are excluded from this process. Contact your attorney for assistance on these kinds of debts.

CREDITORS

You have classified my claim as unsecured although it is really secured. How do I get it changed?
The Trustee's office does not "classify" claims. If our records show the claim to be unsecured, it is usually because the debtor's plan has so classified the claim. The classification in the debtor's schedules and plan may ultimately be binding on you, so you may want to consult your own attorney regarding whether action is necessary to protect your secured status.

The debtor has missed plan payments. How many will you let be missed and still stay in Chapter 13?
The bankruptcy laws do not fix a certain number of missed or late payments that will cause the dismissal of a case. The law merely makes "substantial default" a ground for dismissal. The Trustee's office has mechanisms and personnel in place to monitor debtor's payment histories, and we file many motions to dismiss for material default. However, a variety of variables affect when, if, and how often we resort to this remedy. Detailed information on debtor's payment histories can be found on the Trustee's website. After reviewing this material, a creditor may want to consult counsel regarding whether it may consider filing its own motion to dismiss.

When does a debtor's plan get confirmed?

The confirmation hearing is set no less than 21 days after 341(a) creditor meeting and no more than 50 days after per rule 2003. If no objection is filed, the plan is usually confirmed in court. If an objection is sustained by the Court, the debtor must file a modification to the plan; creditors should receive a copy of this modification, together with a notice of a new period during which objections may be filed and a new hearing date of confirmation.

Website Agreement Form

EMPLOYERS

I have received a garnishment from your office. What is the balance owed?
A payroll deduction letter issued in a Chapter 13 case is not a garnishment. It is simply a tool authorized by Congress, at 11 U.S.C. Section 1325(c), to assist debtors in carrying out their Chapter 13 repayment plans. An employer is not being made a party to any lawsuit; need not consult an attorney; and need not file any papers with a Court; the Employer only needs to comply with the letter by making regular payroll deductions and forwarding those funds to the Trustee. There is no "balance" for the employer to be concerned with; the letter remains in effect until it is revoked by subsequent letter.

What if the amount of the deduction letter exceeds the pay the employee is entitled to during a particular pay period?
You are not required to remit any more than the debtor is entitled to be paid. However, all the funds should be remitted to the Trustee in this event.

My employee is about to go on medical leave. What do we do about plan payments?
As long as the debtor is not entitled to be paid by you, you have no obligations under the deduction letter. However, when the employee returns to work, you should continue to honor the deduction order by resuming payments to the Trustee.