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Chapter 13, complicated situation.

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asel

Member
What is the name of your state? Florida. I have an appointment with an attorney, but not until next Thursday and just need some insight until then about what we might be up against. We have been struggling since the middle of 2002 when there was a serious accident. We are now scraping the bottom of the barrel and have fallen behind one month on the mortgage and just received a certified letter that if we do not get caight up by Jan. 22 in full they will start foreclosure. I fell behind on the mortgage in order to catch up on the vehicle payments. We are intending to do a chapter 13 due to the fact that there is a good amount of equity in the property, tried to refinance but our credit is too low. The property is now for sale. There is also litigation in process from the accident. Question 1) If the property sells, do all the proceeds go to the trustee, we are selling in order to move closer to employment, husband travels 98 miles one way to work, we need the proceeds to find another residence. Question 2) Personal Injury attorney is hopeful of a settlement offer, but no promises, around the end of Feb. "IF" we start the chapter 13 in January, is there a way the bankruptcy attorney can do an agreement that the proceeds that are owed are taken out of the settlement immediately and not held up for a long period, due to the fact that my husband needs an operation caused by the accident? Qustion 3) Or is it better to just try to wait it out to see if the insurance company settles, or if the mortgage company follows through with a foreclosure action? I have been sending them payments on a weekly basis to get caught up, but they want it all by Jan. 22. The mortgage company is Ocwen. They had originally said that the weekly payments were ok, then I get the certified letter. Question 4) Will our income tax return go to the trustee on a chapter 13? Husband has out of pocket doctor visits and needs meds, the income tax return would be a cushion for his out of pocket medical until there is a settlement or the case goes to trial. Our entire debt owed in back mortgage and c/c debt is under 12,000.
 


asel said:
Question 1) If the property sells, do all the proceeds go to the trustee, we are selling in order to move closer to employment, husband travels 98 miles one way to work, we need the proceeds to find another residence.
When the property sells the equity, less the amount covered by your exemption, will become property of your Trustee to distribute among your creditors.

Question 2) Personal Injury attorney is hopeful of a settlement offer, but no promises, around the end of Feb. "IF" we start the chapter 13 in January, is there a way the bankruptcy attorney can do an agreement that the proceeds that are owed are taken out of the settlement immediately and not held up for a long period, due to the fact that my husband needs an operation caused by the accident?

The settlement might also become property of the Trustee to distribute, you will definitely need to seek the advice of your attorney on this one.

Qustion 3) Or is it better to just try to wait it out to see if the insurance company settles, or if the mortgage company follows through with a foreclosure action?
Do not wait on any of this. If they mortgage company has already sent you a certified letter, they most likely mean business. Have you contacted anyone at the mortgage company to make them aware of your situation? Some companies have work out plans.

Question 4) Will our income tax return go to the trustee on a chapter 13? Husband has out of pocket doctor visits and needs meds, the income tax return would be a cushion for his out of pocket medical until there is a settlement or the case goes to trial. Our entire debt owed in back mortgage and c/c debt is under 12,000.

Your return will become property of the Trustee to distribute to your creditors.
 

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