The wage attachment order is attached. Please give it to your payroll office to process ASAP.

Because the wage attachment was not put into place, the Trustee is missing your August payment and the trustee sent the attached notice that I sent to you on 9/8. You must get $594.66 to the trustee’s office (via TFS) by 9/18 or the case will be dismissed. Please send me a screen shot or some other proof of payment so that I can show that the trustee to prevent dismissal of the case.

Keep in mind that for your August and September payments, you will need to monitor your payments and pay directly to the trustee anything that the wage attachment does not. My office does not audit or double check the payments you make to the trustee to check for payment underfunding. You will need to make sure that the trustee gets the full payment each month – whether it be from the wage attachment or in the form of a direct payment from you through TFS.

Converting the case to Chapter 7 would not be helpful and probably harmful for two reasons:

1. You would lose the protection of the bankruptcy automatic stay. Your mortgage company is only being held at bay right now because you have a confirmed plan that pays the pre-petition and post-petition arrears. If you cannot catch up the arrears on your own and maintain the mortgage payments, then you will lose the house unless you can convince the bank to give you a modification. If losing the house is inevitable because you cannot afford the mortgage or plan payments, then the best option is to modify the plan to provide for the sale of the house while still maintaining the protection of the stay. A sale in chapter 13 is controlled by you, you control the price, realtor and timetable for sale. In chapter 7, the trustee sets all of the sale conditions and you do not control anything.

2. Based on current real estate valuation and the CMA we obtained almost 2 years ago, you probably have non-exempt equity in the house, and a chapter 7 trustee would take control of the house and would sell the house. You cannot say “no” to the trustee – who has legal authority to sell the house for the benefit of your unsecured creditors. When we filed the case almost two years ago, we had estimated according to a market analysis that it was worth $285,000d and subject to a mortgage claim of $228,000s. Your two household equity exemptions exempted all of the equity in the house based on a valuation of $280,000, but that was probably on the low end and since then, real estate prices have increased. A Chapter Seven trustee is required to sell the house in order to unlock the unexempt equity in the house for the benefit of unsecured creditors.

Brent