momindebt

Ch13 BK gone bad... need help!

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You said previously that the taxes were being paid for through your plan but BoA jumped the gun and paid them independantly of the plan. Plus you said the turstee was refunded the amount from the tax authority due to overpayment.

Basically it is a washout. BoA is entitled to reimbursement for the taxes they paid, but for nothing more than that. No "fees" or interest or any of that. Since the trustee has been collecting that amount, the trustee should release that to BoA upon receipt of proof that BoA paid it. Either that or at the end of the plan there will be a surplus for the taxes returned to you. Hopefully the trustee did not get over-zealous and divide it up amongst unsecured creditors. You should check with the trustee office on that.

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You said previously that the taxes were being paid for through your plan but BoA jumped the gun and paid them independantly of the plan. Plus you said the turstee was refunded the amount from the tax authority due to overpayment.

Basically it is a washout. BoA is entitled to reimbursement for the taxes they paid, but for nothing more than that. No "fees" or interest or any of that. Since the trustee has been collecting that amount, the trustee should release that to BoA upon receipt of proof that BoA paid it. Either that or at the end of the plan there will be a surplus for the taxes returned to you. Hopefully the trustee did not get over-zealous and divide it up amongst unsecured creditors. You should check with the trustee office on that.

But that is exactly my problem !!! ......... I filed BK (03-27-07), BoA paid the County (04-13-07), the Trustee paid the County (02-22-08 & 03-28-08) and the County returned the payments received to the Trustee (05-27-08).... and then the Trustee started paying 100% back to all my unsecured creditors.... all this within the first year of my BK so I didn't noticed all this until I got the statement that the Trustee sends once a year.... After that, I contacted my lawyer and she didn't do much..... so I contacted BoA myself on April '09 and they claimed they didn't know that I was under BK but could not explain why BoA didn't notified me of the payment made to the County or why they didn't modify my mortgage payment to repay the escrow balance... on May 2009 BoA lawyers filed a motion to revise my BK case and since then they have not responded or file anything else to try to be included on my BK..... In the meantime I have made all my BK payments (around $13,000.00 so far) but I know that I will have to repay BoA sooner or later..... That's why I panic... for me it doesn't make any sense to keep on paying this BK , but now BoA wont be able to make a payment plan with me to repay the escrow until this matter gets resolved between the lawyers... I have been tempted to just dismiss my BK..... should I do that?

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I have been tempted to just dismiss my BK..... should I do that?

EXTREMELY bad idea. If you dismiss it, then it will be like it never happened. ALL your creditors will be able to back date you with intrest and penalties all the way to your filing...and they will be released from the Stay. If you want to see the kind of nuclear wasteland your finances can truely become, then try it. I certainly wouldn't.

You may have to save some of your spending money for a few months so you can fire your current lawyer and get a different one to clean up this mess. It really seems your lawyer just doesn't want to have to work. Sure you should pay for the extra time the lawyer has to put in, but to not even offer to do it for a fee? That's a breach of the fiduciary duty to represent YOUR interests fully.

This really shouldn't be all that hard to deal with. The trustee spent estate funds outside the plan due to a rogue creditor action. A mistake without malice intended certainly, but this unbalances the plan. What the trustee should be doing now is not paying any unsecured creditors until that mistake has been corrected. The funds should be going to the taxes even if it is through a 3rd party since that is what the plan called for.

Have you tried writing a letter to the Trustee explaining the problem and asking what the Trustee intends to do about the error?

Edited by Methuss

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Have you tried writing a letter to the Trustee explaining the problem and asking what the Trustee intends to do about the error?

When I first noticed the error and got frustrated that my lawyer wasn't helping much, I called the Trustee's office and tried to explain my problem but they told me that I had to fix it thru my lawyer..... Then I went and consulted another law firm and they told me that they could take over my case for a fee of $2,000.00 but really they wouldn't be able to do anything much different than what my lawyer was already trying to do .....

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That is why I say you have to be VERY detailed with the mortgage lender after the bankruptcy to make sure they are not trying to hold you personally liable for discharged amounts. Yes they still get paid for the loan if you want to keep the property and they can still foreclose if the lien is not satisfied. But they cannot charge late fees and other garbage fees during the plan unless they have asked and gotten permission from the court.

This didn't stop our mortgage servicers in our Chapter 13. Something smells rotten here to me, Methuss. I know you keep saying it was simply an error on BoA's part, but I wouldn't put money on that! Momindebt - I really feel for you. I've been where you are...we were 1/2 way through a 3 year Chapter 13 when we discovered our servicer paying out escrow, leaving us with a balance when we didn't have an escrow set up. We had an escrow going into the Chapter 13, for forced place (bogus) insurance, we HAD insurance for the entire duration we owned the house and our lawyer, when we filed, said "just let it go through" didn't even TRY to argue to the court that Countrywide was asking for more than they were due.

I wish I could say we had a happy ending with that, but we didn't. One story that scared the bejesus out of me was of another couple that made it all the way through their Ch. 13, case dismissed, and then BAM! There came Litton Loan Servicing (who took over our mortgage from Countrywide right after we had filed) and said "you still owe us $20,000" (it was fees and escrow that piled up somehow during the BK)! Methuss, now I know that was probably illegal based on what you are saying, but again when I took that fear to my lawyer after we discovered Litton was charging us fees and piling up escrow, his advice...convert to Ch. 7 and let it go. Attorney's don't even want to fight for their client's it seems and that's if the client has the means to offer them money. I can't even tell you how many injustices I've seen in my short life just go unchallenged because a lawyer, or several, simply turned up his nose on taking the case! Unbelievable really....and very, very sad.

We decided to convert to Ch. 7, it was the solution for us at the time. We are much better off...now...but it was hard and so, so scary at the time. We had other factors that contributed to that, however, Momindebt seems to have a much simpler issue at hand and seems totally fixable. So, don't do anything rash, Mom, like Methuss has said just try to stay calm. Panic will not serve you. And I certainly don't mean to scare you, I really feel for you and wish you the best and Methuss is one of the best people on here to be giving you advice, he is much more knowledgable than I - however I just don't think things, especially when it comes to mortgages, banks, bankruptcy, etc. are so black and white anymore.

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Attorney's don't even want to fight for their client's it seems and that's if the client has the means to offer them money. I can't even tell you how many injustices I've seen in my short life just go unchallenged because a lawyer, or several, simply turned up his nose on taking the case! Unbelievable really....and very, very sad.

Thanks April !

I really appreciate your comments ........ And it's true, I do feel like my lawyer is not even trying to look after my best interests, is like she wants to drag this thing out until the end of the BK....but even when I panic and feel like trowing the towel I don't want to be a victim of this system, that's why I keep on asking questions and bugging people ....... I can't afford to loose money that I don't even have !

Finding this forum has helped me lots and I sure appreciate the help and good intentions of people like you and Methuss who has been there with me since the beggining......

Thanks !

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You're welcome.

And not to be combative, but my mother spent twenty years in the mortgage business and I spent five as a law department manager at a bank. What does that experience bring to the table? That I can definitively say that lenders and servicers make monumental mistakes all the time.

Want to scare the crap out of BofA, momindebt? Send them the letter I put in this thread: http://debt-consolidation-credit-repair-service.com/forums/showthread.php?t=280456

Send it certified, return receipt. Send it once a year until your plan is finished.

Bet me you will get one letter acknowledging they got your request and then either nothing, or they will not answer all your questions like they have to. Because they either don't know, or they find they messed up and don't want to hand you the evidence to bury them. Keep all this paper trail for counterclaims if you find yourself in trouble with them after your plan is done. RESPA is very unforgiving to lenders and servicers that don't do what they are obliged to.

My original post doesn't mention it, but under the Sarbanes-Oxley Act, everything that is asked for in the letter is required by law to be kept in their records permanently. So they cannot say they don't have it or they are in violation of another law.

Edited by Methuss

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Dear Methuss:

You are my hero !!!! I just printed the letter and I think this would help me enormously ...... I'm pretty sure that it will make them speed things up with their lawyers.

Last week I contacted the escrow dep of BoA and I explained my situation to one of their agents. I told her that I wanted to know if they would make a payment plan with me to repay the escrow in a period of 3 years... If they agree to this I would modify my CH13 and start paying the balance on the escrow..... She told me that the manager would agree to the plan since this is something they have done before but my acc has a "hold" that can only be removed from the people in the bankruptcy dep..... So I called the bankruptcy dep and they told me that my lawyer would have to contact theirs in order to make some kind of agreement and then they would be able to take off the "hold"..... When he said that, I replied that we have waited and waited for their lawyer to respond but since they have done nothing since April this year, I decided to start making calls to get this resolved.... He said that he'll contact their lawyers and see why they are taking so long..... I also wrote an e-mail to my lawyer about this conversation I had with BoA and she said that she forwarded my e-mail to BoA's lawyers and they are looking into my case....

I will send this letter to BoA ..... This is awesome ! They are going to have to take me seriously now ..... They have been trying to find something that puts me in default of my loan... Just last week they called saying that they don't have proof of my home insurance (I faxed a copy of my policy back in Feb) so I went to the bank and brought my policy w me and I made sure that one of the agents make a copy for their records....

I don't have enough words to thank you Methuss .... Honestly with your advice I feel more confident about getting out of this mess and also I can sleep better now .... :D

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Hi Everyone !

Happy New Year ! .....

Update on my case :

BoA finally had their lawyers file to be included in my BK ..... they filed in court by the end of October '09.

Since then nothing has changed... my lawyer told me that we didn't have to respond in court, just let them get included and eventually my payments would be sent to them instead of any other creditors......

Does anybody have an idea of how long does it take for the court to make a change like this in a BK?

Thanks in advance for your help !

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Hi guys !

I'm in desperate need of advice !!!!

As an update on my case: I have been on BK13 for 2 yrs still waiting for BoA to be included on my BK (they filed to be included on 10/09) . Over the weekend they sent a notice to let me know that my mortgage payment will be modified starting 04/10 for more than $1,000.00 per month over what I'm already paying as a mortgage payment ( to satisfy the escrow balance on my account).......

Can they do this ???? there is no way that I will be able to make that kind of a payment even if I drop my BK...... My lawyer is overly negligent and I'm not even sure how to drop the BK or how to stop the BK payments from being withdrawn from my paycheck !!!!

I'm desperate...... please help !!!

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What is with your lawyer?!? He really doesn't seem to want to do the work he was paid to do.

To just let BofA submit whatever they want to the court and not even review it? What the hell is he thinking? They could easily be tripling the amount they are really entitled to and he isn't even blinking about it!

Have they replied to the RESPA letter (I hope you sent)? That letter will require them to disclose fully how they have calculated the escrow balance, amongst the rest of the items.

Look, at this point you face having to come up with $1000 a month for over a year to pay what BofA is asking or paying $2000 to the other law firm to pick up your case and clean this up. I think the choice is obvious. You need to get a different lawyer to represent YOUR interests then fire this deadbeat attorney and file a complaint with the Bar for breach of fiduciary duty. You may even be able to sue him for being so negligent to recover your costs to get it done right.

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Hi Methuss !

I did send that RESPA letter certified back in October and I got the return receipt.... they have not responded. I'm not sure if that letter had anything to do w/BoA lawyers filing the transfer on my case on that same month.

I also called the BK clerk and they told me that I needed to go to my attorney before trying to see the judge... when I explained how negligent my layer is, she told me to write a very detailed letter to the judge explaining my case, that way I can get things resolved without having to hire another lawyer and also told me what to do to file a complaint against my lawyer.

On that same day (Feb 17) I went to see my lawyer and she got on the phone with BoA lawyers to see why they're trying to modify my mortgage pymt... He admitted that he has no idea but will try to have BoA agree to make a modification on my mortgage payment to repay that escrow balance on the 2 yrs 9 months that are left on my mortgage instead of repaying in 1 year.

My lawyer also told me that I'm only 1 month away to complete 3 years paying on this BK and that after that I can modify it to have it discharged... sadly I'm unable to hire another lawyer so I guess my best option would be to do this and then deal w/BoA...

I sure appreciate your help during this ordeal ..... It's been a nightmare but your advice has help me keep my sanity !!!

P.S. I'm working on my letter to the judge just in case BoA won't work w/me.... Do you have any advice on that?

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Hi Guys !!!

It's been a long time but I'm back just to report that I'm DONE with my BK!!!

After paying 3 years on the plan, the judge allowed me to discharge the BK and after struggling for years, BoA finally agreed to put me on a payment plan to repay the escrow balance for the 2 remaining years on my mortgage !!! (yes, they worked w/me even when I didn't have my discharge letter....)

About 3 weeks ago I received my discharge letter and just last week I got me a brand new car with a company that offered me a very low APR and the best of all is that I didn't have to give a down payment !!!

In my case, going thru this BK was horrible ... but I can honestly say that I couldn't have finished it without y'all support and advice !!!

THANK YOU !!! xdancex

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Excellent news.

And nice to hear BoA is behaving themselves now.

But just because the hardest part is behind you don't let your guard down. There are still wolves out there that may contact you over things that are done and discharged. (I sure as heck had a few -- went through about 15 copies of discharge notice before things calmed down) Be ready with a nice "go pound sand" letter.

BTW...did they ever answer the RESPA letter...completely?

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Hi Methuss !!!

You know, they never did respond to the RESPA letter...... I still have my copies and I'm ready to use it again !!!

I'll follow your advice and will be ready for whatever comes after this ....

And thank you very, very much again for your advice... it was priceless to me!!! :)++

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