October 17, 2010
Important Chapter 11 Stuff I Learned at the cdcbaa Meeting Yesterday
We had a great program yesterday put on by Dennis McGoldrick and Peter Lively. Here is some important stuff I learned (making me extremely glad I went):
- Get the budget for your individual debtor approved by the court at the beginning of the case (I have never done that),
- Check the trust deed to see if there is an assignment of rents clause before you file your motion to use cash collateral (you may not need to file it),
- Individuals have to pay their net disposable income for the longer of five years or "during the period for which the plan provides payments," (yikes!)
- Individuals have to pay their projected disposable income for five years only if an unsecured creditor objects to confirmation. A "no" vote is not an objection,
- "Projected disposable income" starts with "current monthly income," since 1129(a)(15) directs you to 1325(b)(2). Remember though that the five years begins with the first payment, often months and months after the case was filed; CMI is based on the six months prior to the petition date.
- When you need a "consenting class," consider proposing some payment to the completely unsecured second instead of just stripping it off.
- The "hanging paragraph" does not apply to chapter 11. You can bifurcate the claim on a "910 vehicle."
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Posted by: Carol | Oct 28, 2010 7:40:20 AM