When you go through Chapter 13 bankruptcy, you make a plan to repay your debts and satisfy any creditors. You have to stick to this plan. If you think that you are going to miss a payment, you should take action right away to ensure that it does not jeopardize your case. A Rockland County Chapter 13 bankruptcy lawyer can tell you more about your responsibilities and what you can do to stay in the good graces of your bankruptcy trustee and creditors.
Are You Allowed to Miss a Payment in Chapter 13 Bankruptcy?
You are supposed to pay on time when you make a payment plan through Chapter 13 bankruptcy. There is no grace period or accommodation for repeated late payments generally. Missing a payment can put your case at risk.
That being said, there are some steps that you can take if you believe that you’ll miss a payment or be late with one. You should:
- Talk to your lawyer
- Tell the bankruptcy trustee that you need time to catch up
- Be willing to go to court and extend the repayment timeline
This shows that you are proactive and that you care about sticking to your plan.
What Can Happen If You Miss a Payment?
Being late or not paying at all can cause all sorts of issues. It could put an end to the automatic stay that was issued when your bankruptcy began. This can mean that creditors will once again begin pursuing you for the debts that you owe.
You could also have your case dismissed. This is not a discharge. A dismissal ends your payment plan and prevents you from having your financial slate wiped clean.
Can My Bankruptcy Plan Be Modified?
It may be possible to modify your bankruptcy payment plan. If you can show that you have encountered economic hardship recently, you may be able to reduce the amount of your payments or extend the amount of time you have to pay off your debts. In some cases, you can even get a hardship discharge of some or all of your remaining debts. If you are struggling to make payments, a lawyer can help you gather the evidence needed to show that a change should be made.
Can My Debts Still Be Discharged If I Miss a Payment?
If you do not qualify for a hardship discharge, you can still get your debts discharged even if you miss a payment. As long as you are not routinely making late payments, you should be able to recover and continue with your payment plan. You can also get a discharge if you modify your payment plan and continue to pay on time.
Meet With Our Bankruptcy Attorneys
If you want to learn more about the bankruptcy process, contact the Lauterbach Law Firm. We can help you determine if bankruptcy is the right way for you to get a fresh financial start.
