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DrakeLAW, Attorney
Category: Bankruptcy Law
Satisfied Customers: 756
Experience:  Attorney at Drake Law Firm PLC
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Re: an individual Chapter 11's post-confirmation "plan"

Customer Question

Re: an individual Chapter 11's post-confirmation "plan" payment period of 5 years.
What happens if the debtor's income increases dring the five years?Please assume that two loan balances were crammed down, a) the unsecured portion of the bifurcated first on an upside down-rental property, and b) the entire HELOC. Both lenders accepted the plan, which will allow them to receive just 5% of their lofty balances, paid out in 60 payments of equal size. They are the only entities receiving plan payments, other than the debtor's attorneys.If the borrower's income rose by $500/month, would the new amount get divided between the two creditors, increasing what they recover, whilst the debtor has the same amount he had before?
Submitted: 11 months ago.
Category: Bankruptcy Law
Expert:  DrakeLAW replied 11 months ago.

Hello, my name is ***** ***** I can help you with this.

In chapter 11, increases in the debtor's income post-confirmation will not accrue to the creditors, the debtor retains that income. About the only thing one can do is allege misrepresentation in any income predictions that creditors relied upon but it doesn't seem that $500/mo is a big enough variance to be successful on such a claim.

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