Chapter 13 payment plans generally last between 3 and 5 years. Meanwhile, a lot can happen, and unfortunately, not everything may be favorable for a debtor. They can lose a job, get sick, or have to face other unexpected expenses. For any of these reasons, a debtor may find themselves unable to make mandatory Chapter 13 bankruptcy monthly payments. If such a situation occurs, it is crucial to react promptly, contacting an experienced bankruptcy attorney in Carlsbad to provide guidance and legal support in the case.

Missing to pay Chapter 13 bankruptcy monthly payments: How to save the case

If a debtor can’t make the obligatory Chapter 13 bankruptcy monthly payments, it doesn’t necessarily mean that the situation is damaged beyond repair. Several steps can be taken to get the payment plan back on track:

  1. Contact an experienced bankruptcy lawyer immediately. Whichever course of action you end up taking, it is crucial to examine the case and the possibilities to preserve it with a reliable bankruptcy lawyer. Whether you need legal advice about your monthly payments, redemption or debt reaffirmation, or your creditors start calling you after bankruptcy, an experienced bankruptcy attorney will be there for you every step of the way.
  2. Ask for a brief payment adjournment. If you encountered an unexpected financial emergency (especially if it’s a short-term one), you may ask the court for a brief adjournment in your payment plan. The court will have a final say in approving or dismissing your appeal.
  3. Apply for a hardship discharge. This is a course of action that can save your current assets and the entire case, if the reasons for missing to pay Chapter 13 bankruptcy monthly payments are beyond debtor’s control (check the reasons mentioned in the introductory paragraph). After the case is presented, the court examines the situation and determines the arrangement that will be favorable for all included parties;
  4. Revise the current payment plan. Use the current situation in your favor, and take a good look at your current payment plan. Perhaps some adjustments can be made to make it more bearable in the future.
  5. Convert your Chapter 13 case into a Chapter 7 case. If none of the above-mentioned possibilities apply in your situation, you may opt for converting your current plan into a Chapter 7 bankruptcy plan. You will need to prove that Chapter 7 is a valid option for your case, and the court will determine the best course of action, based on the evidence and the case itself.

What to do if my Chapter 13 case cannot be saved?

This may sound like a terrifying outcome, but letting your Chapter 13 case get dismissed may not be a bad thing for your financial future. This would allow you to file again for the same plan after it got dismissed the first time, on different terms and timelines, at the moment when your income improves.

Take control of your Chapter 13 case with the help of a dependable bankruptcy lawyer

Filing for bankruptcy is a stressful process, but it’s important to remember to keep a cool head. No matter what happens, if you keep an experienced bankruptcy lawyer by your side at all times, the chances are your bankruptcy case will eventually turn out the way it’s supposed to. Don’t risk your financial future – contact Chang & Diamond, APC, the expert bankruptcy attorneys, and book a free consultation today.