What Happens If I Can’t Make My Chapter 13 Bankruptcy Payment?
What Happens If I Can’t Make My Chapter 13 Bankruptcy Payment?

If you are facing significant debt, but would like to try and keep your assets, you can consider filing a Georgia Chapter 13 bankruptcy. In a Chapter 13 bankruptcy, rather than liquidating your assets, you create a repayment plan that allows you to keep your assets and pay back your debts over a period of three to five years.

When you create your repayment plan, you can work with an experienced Georgia Bankruptcy Attorney to make a plan that works for your specific situation. A Chapter 13 bankruptcy requires you to have a source of income—any disposable income will go toward your repayment plan. Your monthly payments will be made to your bankruptcy trustee who will in turn use the funds to pay back your creditors.

Missing Your Payment

So, what happens if you can’t make one of your monthly Chapter 13 payments? Unfortunately, if you miss a Chapter 13 payment, it is possible that your bankruptcy could be dismissed. When you fail to make a payment, the bankruptcy trustee can ask the Court to issue a dismissal. Rather than let your case be dismissed, there are a few things you can do:

  • Talk to Your Trustee: If the reason you missed your payment is due to a temporary setback, such as a family or medical emergency, talk to your trustee. It is possible to make arrangements and get approval to have your payment made by a certain date.
  • Modify Your Repayment Plan: If you lose your main source of income during the course of your plan or your income goes down, you may need to change the amount you pay monthly towards your plan. This requires filing a motion with the court to modify your plan—your trustee and creditors are notified. Then you will need to explain why you have to change the plan, and propose a new plan which will need to be approved by the Court.
  • Convert Your Chapter 13 Bankruptcy to a Chapter 7 Bankruptcy: If it looks like your circumstances have changed so drastically you won’t be able to make your payments, even if modified, then you may want to consider converting your Chapter 13 bankruptcy to a Chapter 7 bankruptcy. If you choose to do this, it is important to understand that your nonexempt assets will be liquidated, or sold, to pay back your creditors. If you are considering this option, be sure to talk to a knowledgeable Atlanta Bankruptcy Attorney so you fully understand how this change will impact your situation.

 Get Your Chapter 13 Bankruptcy Questions Answered

 If you are considering filing a Chapter 13 bankruptcy, or you have filed a Chapter 13 bankruptcy and are concerned about making your plan payments, reach out to the skilled bankruptcy attorneys at The Ballard Law group—we can answer your questions and assist you in navigating the Chapter 13 bankruptcy process so you can do what is best for your financial situation. Contact us today for a free bankruptcy consultation by calling 404-220-9906!