Eastern District of Texas: Bankruptcy Local Form 3015-c

BankruptcyIn late 2012 a new requirement for confirmation was introduced in Chapter 13 bankruptcy cases filed in the Eastern District of Texas.  Debtors are now required to certify that they are current on their direct payment obligations (DPO) and domestic support obligations (DSO) at the time of the confirmation hearing by signing a Form 3015-c.

A direct payment obligation is any secured claim that the Chapter 13 plan states the debtor will pay directly to the creditor.  For example, if a debtor has a house with a mortgage they intend to keep then their Chapter 13 plan probably states that they will pay the mortgage directly to the creditor.  The mortgage in this example is a direct payment obligation.  This requirement also applies to car notes and any other secured claim that is being paid directly.

Domestic Support obligations refer to child support, alimony, and spousal maintenance.  The debtor must be current on all domestic support obligation payments that first came due after the bankruptcy petition was filed.  Arrearages, or DSO payments that came due before the case was filed are paid back in the plan through the trustee.

When a debtor is behind on their DPO or DSO at the time of the confirmation hearing then the plan cannot be confirmed and either the debtor (or his attorney) will need to deny confirmation and set a new plan for hearing or else request a continuance in order to give the debtor more time to get current on the payments.

The debtor can also request a written agreement with the creditor which states that the parties have agreed that the debtor will be allowed to make payments by a later date.  If the debtor is current under the agreement then the court will most likely accept the agreement as satisfying the Form 3015-c requirement, and assuming there are no other objections or bars to confirmation, the plan will be confirmed.

Nathan