Local Rule 3070-1: CHAPTER 13 - PAYMENTS

LOCAL RULE 3070-1: CHAPTER 13 - PAYMENTS a. Following confirmation of a plan, all funds in possession of the chapter 13 trustee shall be disbursed pursuant to the terms of the confirmed plan. Unless the Court orders otherwise, creditors shall receive adequate protection as required by 11 U.S.C. § 1326(a) from the plan and the provisions set forth below.

b. Upon the dismissal of a case, the chapter 13 trustee shall, after first paying the balance of any sanctions as directed by the Court, dispose of funds in the following manner, unless otherwise ordered by the Court:

1. If there is a confirmed plan in the case, the chapter 13 trustee shall pay any funds received prior to or on the date of the dismissal of the case to creditors according to the terms of the plan. All funds received thereafter shall be paid to the debtor.

2. If there is neither a confirmed plan nor an order directing otherwise, funds received prior to or on the date of the entry of an order of dismissal shall be disbursed as follows:

A. First, in a Conduit Plan, the applicable mortgage creditor(s) shall be paid a Mortgage Payment for each full monthly payment received from the debtor as a Gap Payment and/or Conduit Mortgage Payment. No payment shall be made for partial payments received from the debtor, and no payment shall be made unless a Compliant Proof of Claim or proof of claim filed pursuant to 11 U.S.C. § 501(c) has been filed on behalf of the mortgage creditor(s);

B. Second, the trustee shall disburse to the debtor's attorney the lesser of the remaining amount due to debtor's attorney, or the remaining balance of funds received by the chapter 13 trustee prior to dismissal;

C. Third, as adequate protection required by 11 U.S.C. § 1326(a), the trustee shall disburse payments to holders of allowed claims secured by personal property and allowed claims for executory contracts that are proposed to be paid through the most recently filed plan. Subject to the availability of funds, these creditors will be paid a full payment for each full month beginning thirty (30) days after the order for relief and continuing through the date of dismissal. No payment will be made for partial months; and D. Any funds remaining after these payments, and all funds received after dismissal, shall be returned to the debtor unless there is a pending Motion to Reconsider Dismissal.

3. Notwithstanding any other provision of this Rule, after dismissal of a case with a Conduit Plan, if a mortgage creditor returns to the chapter 13 trustee any funds disbursed to it by the trustee under the terms of the Conduit Plan, the chapter 13 trustee shall return those funds to the debtor.

c. Unless ordered by the court or the debtor consents otherwise, upon the conversion of a case, the chapter 13 trustee shall return all funds on hand, and all funds received after conversion, to the debtor.

Notes:

(2021) Paragraph (b)(3) was added.

(2023) Paragraphs (b)(1) and (2) were revised to account for funds received on the date of dismissal.