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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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Why does most of the money paid to the trustee go to Bank of

Resolved Question:

Why does most of the money paid to the trustee go to Bank of America? There is an auto note the has been paid little or nothing. The money owed the IRS has not ben paid at all. Is this the letter of the law?
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 6 years ago.
Hi JACustomer,
1) What type of debt is the BoA debt? Is it secured or unsecured?
2) What type and for what years are the IRS taxes?
3) Is this a Chapter 13 Bankruptcy?
4) Was it your intention to keep the car?
Customer: replied 6 years ago.

1. Secured by my home, the value may not be sufficent to sell without a short sale.

2. This has to be employment taxes from 2009.

3. Yes

4. Yes

Expert:  cfortunato replied 6 years ago.

1) When your plan was formulated, you were supposed to indicate how much of the monthly plan money was supposed to be submitted to each listed creditor. Additionally, you could have chosen to pay the secured debts outside of the plan. Were either of these done?

2) Is the car worth less than the balance on the car loan?

3) If yes, did you have the car more than 2 1/2 years before you filed the Bankruptcy?

Customer: replied 6 years ago.

1. I wasn't asked what I wanted to do, the plan apparently was formulated by my Trustee and or Attorney.


2. It is entirrly possible now that my 2005 Pontiac Vibe is not worth the $4000 + that is owed.


3. Yes it was bought new in 2005


Expert:  cfortunato replied 6 years ago.

It is possible that the trustee is paying the most money to BoA with the intention of allowing you to keep the home.

It is also possible that the car loan was "crammed-down". This mean the unsecured portion would be discharged. The unsecured portion is the amount of the car loan that is more than the current value of the loan.

If you are not happy with the way the money is being distributed, your attorney can change the payment arrangements.


I think this is what you wanted to know. If not, please let me know.
Thank you!


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