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Ellen
Ellen, Attorney
Category: Bankruptcy Law
Satisfied Customers: 36714
Experience:  Bankruptcy Lawyer. Experienced.
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About 4 1/2 years ago,my wife and I had a very unusual circumstance,we

Customer Question

About 4 1/2 years ago,my wife and I had a very unusual circumstance,we filed for ch 7 bankruptcy, then switched to ch 13 in order to save our home. Eventually we switched back to ch 7 and the home was lost in foreclosure because the payments the court was asking were so monumental over 4300.00 a month. My question is since the court discharged the debts back in June 2008, what happened to all the money we paid to the court while we were still under ch 13? Being the case was discharged, shouldn't part or all of the monies sent to the court have been returned as the bank took the home anyway?
Submitted: 5 years ago.
Category: Bankruptcy Law
Expert:  Ellen replied 5 years ago.
Welcome to JustAnswer,

So sorry to hear of this dilemma. If my answer is not clear to you, please ask me for clarification by using the reply button.

The money that was paid under the chapter 13 plan would have been disbursed to the creditors as stated under the plan. Regardless of the fact that the house was foreclosed, the mortgage was still required to be paid as well as the other debts scheduled in your chapter 13 plan.


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Customer: replied 5 years ago.
But he ch 13 plan was negated when we refiled for 7, and the bank went forward with the planned foreclosure acting as if we did not pay a dime. Most of this money was in late fees and a ridiculous interest rate that the Saxon mortgage company imposed. This bank would not bargain or listen to us no matter what we did. This is why we refiled ch 7.

Thanks, Tom & Sally Wise
Customer: replied 5 years ago.
But the ch 13 plan was negated when we refiled for 7, and the bank went forward with the planned foreclosure acting as if we did not pay a dime. Most of this money was in late fees and a ridiculous interest rate that the Saxon mortgage company imposed. This bank would not bargain or listen to us no matter what we did. This is why we refiled ch 7.

Thanks, Tom & Sally Wise
Expert:  Ellen replied 5 years ago.


If you had filed a chapter 7 without having had filed a chapter 13, any money that you had on hand would have been paid for the benefit of the chapter 7 creditors unless it was exempt.This is a similar result.

The chapter 13 plan was converted into a chapter 7 and therefore any money on hand would have been paid to the creditors.

I understand that you did not receive the benefit that you expected as a result of filing the bankruptcy however the fact that you lost the house does not mean that you did not owe the debt to the lender and the other creditors.