Chapter 13 question 1 year later

[nettyb40]

This is in Michigan.

My brother filed for Ch 13 as the result of a divorce and subsequent BK filing by his ex. March 2005 he successfully completed his payment plan including making a balloon payment at one point due to a mistake by his attorney. Now he is being harrassed over interest/penalties for payments it appears the trustee made late. He's a little computer phobic so I am trying to help him obtain the information he needs to fix this and his credit reports as much as possible.

I have printed his credit reports for him as well as advice on how to proceed in clearing them up from creditinfocenter.com along with their sample letters.

A friend of mine, who was in a similar situation after his divorce, said it is possible that the trustee could have made late payments and he should request a full accounting. I have told him to do that as well. Is there anything else he can do? Can the trustee be held accountable for late payments?

Thanks for any help you can give.

nettyb40

[azatty]

There's not enough information here to give you advice. WHO is harassing him? A credit card company? A mortgage company? An auto lender?

In our plans, we only pay mortgage arrearages through the plan, and the law is pretty clear that a confirmed plan cures defaults on a mortgage. So I don't think it would be a mortgage company. It's possible, though, as I know some lenders will continue to try collecting late fees for arrearages paid through the plan. Get the lawyer involved if this is the case.

An auto lender's debt may have been restructured in the bankruptcy, so the lender may or may not have the right to claim late fees, etc.

If it's an unsecured creditor, have the lawyer send them a nastygram. Unsecured creditors are not entitled to interest, late fees, or penalties. A mortgage company, if it is oversecured, can assess such items.

[nettyb40]

I'll have to check about the type of creditor tomorrow and post the answer. He's in bed by now. I know he reaffirmed his mortgage and has been able to keep his house. I believe it is a credit card company. Complaining about one of the first payments under his plan. I know he is still trying to get an unsecured debt from a credit union that was on his Ch13 to remove the 4 years of open, unpaid account they reported after the judge told them they were getting nothing. They had tacked on a load of interest and penalties AFTER the stay to double the amount owed knowing they wouldn't get everything.

His ex had taken out a large number of credit cards, etc. forging his signature in the last year of the marriage. Some he could prove were not his signature, some he could not. Those he could the judge designated into her BK. He still ended up paying a lot.