You have just filed a Chapter 13 Bankruptcy and you probably have a lot of questions. This pamphlet is provided to you solely to introduce you to some of the important concepts and provide information about common questions that arise in Chapter 13 Bankruptcy. Your attorney will be your resource for any individual concerns, legal rights, or specific questions about your particular situation. The Trustee’s office will attempt to assist you with your plan but the Trustee is prohibited by law from giving you legal advice. Any question that includes “what should I do” is best directed to your attorney.
The filing of a Chapter 13 imposes a stay upon your creditors from collecting from you directly. If any creditors attempt to contact you directly, inform them that you have filed a Chapter 13 Bankruptcy and refer them to your attorney.
Your Chapter 13 plan requires you to make regular payments. Your first plan payment is due 30 days after your bankruptcy case is filed and a payment will be due every month on that date thereafter. If timely payments are not made, we will ask the Bankruptcy Court to dismiss your case. There are three ways to make plan payments:
1. Payroll deduction: The court enters an order that the trustee’s office mails to your employer. Payments are deducted every pay period and mailed to the trustee. This takes a few weeks to go into effect so you will probably have to make the first payment directly. You can choose to have a payroll order entered at any time. We highly recommend that you have your plan payments deducted from your paycheck. Persons that have the payments deducted from their paychecks have a better chance of completing their Chapter 13 plan. The Court may order payroll deductions if you fall behind on your plan payments.
2. Pay on line using TFS. TFS is the only on line method that is allowed. If you use your bank’s on line payment process the check will be voided and returned to you.
3. Mail a cashier’s check or money order. Your name and your bankruptcy case number must be clearly written on the payment. Our bank will not accept personal checks! All personal checks will be returned. The mailing address for payments is:
Office of the Chapter 13 Trustee
P.O. Box 2368
Memphis, TN 38101-2368
Please save all receipts from all payments that you send or your paycheck stubs if the payments are being deducted. Therefore, if there is any discrepancy, you will have a record of your payments and there will be a method to trace them.
3. Your Case Number
When your Chapter 13 Bankruptcy was filed, the Clerk assigned it a particular case number. This number is like an account number with our office. It must be on all payments, correspondence with our office. If you call our office, please have this number available.
4. Your Attorney
The scope of your attorney’s representation will be governed by whatever agreement the two of you have made. Make sure that you discuss whether additional legal services, which may be required during your plan, will be at an additional cost to you. Your attorney is there to answer any questions or concerns you have regarding your case. Your attorney is your legal advisor. The Trustee’ office will not give you any legal advice regarding your case.
All creditors must file a proof of claim with the Bankruptcy Clerk in order to receive distributions from your Chapter 13 plan. Non-governmental creditors have 90 days from the 341 meeting to file a claim. Governmental agencies have up to 180 days from the filing of the case to file a claim. The Trustee will pay the creditor based on the amount that is listed on their claim. If you disagree with the amount claimed, you must notify your attorney.
Unless a claim is properly objected to, the amount on the claim will control. If you find a creditor that you forgot to include in your Bankruptcy, contact your attorney immediately. The Trustee’s office will send you a periodic report of disbursements to creditors. If you disagree with the disbursements, immediately contact your attorney.
You must notify the Trustee, your attorney and the Bankruptcy Clerk of any change of address. The notification must be in writing. Our address is:
Office of the Chapter 13 Trustee
801 Warrenville Road, Suite 650
Lisle, IL 60532
7. Encountering Problems
Unexpected situations such as illness, loss of wages or unexpected expenses can affect your ability to comply with you plan. If you experience a problem making your plan payments, you must contact your attorney immediately. It is important to remember that the Trustee’s office has no authority to allow you to miss a payment or to let you pay less than what your plan provides. An order approving your plan binds you to make all required payments. If you simply stop making payments, the Trustee will seek dismissal of your case.
If you wish to sell your home or any other property, contact your attorney. You likely will not be able to dispose of any property without court approval.
9. Obtaining New Credit
The Trustee does not have the authority to approve incurring debt. If you wish to do so, contact your attorney.
If there are any creditors that you are making direct payments to (such as a current mortgage payment), you must maintain those payments as you do your payments to the trustee. If you fall behind on those payments, that creditor may be able to take that property away from you. Keep receipts for all payments you make directly to creditors.
The agreements that you have with your secured creditors (such as for a home or a car) require you to maintain full coverage insurance for that property. If you fail to maintain insurance, that creditor may be able to take that property away from you.
If during your case, you fail to make timely payments under your plan or other substantial problems arise, the Trustee will seek dismissal of your case. If your case is dismissed, your creditors will be able to pursue you directly for payment of your debts. If you receive a motion to dismiss from our office, contact your attorney immediately to discuss the situation.
The trustee will periodically send you a summary of your case. The summary will reflect the payments that you have sent in, the amounts that your creditors are claiming, and how much they have received. Please review the summary carefully to review for any discrepancies. You may also contact our office at any time if you need any of that information sooner or any other questions you may have about your case. You may also access our website at www.lisle13.com
Once you have completed the payments under your plan, the Trustee’s office will begin to close your case. Contact your attorney when you make your final plan payment; if you are eligible for a discharge you need to sign a Declaration Regarding Domestic Support Obligations for your attorney to file with the court. The case closing process takes approximately 6-8 weeks after the final plan payment is received. The closing process consists of the final disbursements to creditors and an audit to verify that all claims and court orders were paid correctly. When the audit process is complete, if you are eligible for a discharge, your discharge papers will be issued by the court and a notice will be sent to you and your creditors informing them of the discharge. The Trustee will not have a copy of your discharge papers. The trustee is not holding any title to any vehicle, the creditor will send it to you directly but you may need to contact them. Please note: your discharge order will be mailed to you at the address of record with the court. If you have moved you must contact your attorney to update your address with the court.