Updated: 2021-04-30 by
Line 42, Future payments on secured claims.
- Total all payments coming due in the 60 months following filing and divide by 60.
- In the case of a variable rate loan, use the loan rate in effect on the petition date tocalculate the payments.
- In the case of a "balloon" payment within 60 months, use the full amount of theballoon to calculate the average payment.
- Does not include property subject to a lease rather than a loan.
- Includes all secured debt, even "toys" and luxury items. Although the USTP positionis to allow secured payments for luxury items on this line, the Program believes that luxury expenses may demonstrate that a petition was filed in bad faith warranting dismissal of the case under section 707(b)(3)(A), and may be considered in determining the totality of the debtors financial circumstances under section 707(b)(3)(B).
- Includes a secured loan payment, even when the value of the collateral is less than the amount of the loan.
- Outside the First Circuit, does not include payments when the debtor intends to surrender the collateral securing the loan.
- In the First Circuit, debtor may include payments on line 42 when the debtor intends to surrenderthecollateralsecuringtheloan. However,theUSTPpositionisthatthe failure of the debtor to continue to make the payments post-petition in surrendering the property may be considered in determining the totality of the debtor's financial circumstances under section 707(b)(3)(B).