If you are in a Chapter 13 bankruptcy, and find that you are having trouble making the payments, there is a way to save your case and stay in bankruptcy.
Most courts will allow you to file a motion to suspend payments for a period of time. Some courts will allow a suspension of up to 3 months.
Often times, folks fall behind in their payments due to temporary job loss, unexpected bills, or illness. These are situations where filing a motion to suspend payments can help.
There are a couple of different options for catching up the payments that get suspended and not paid. You can propose in the motion that the amount be paid back over the life of the plan, by increasing the play payment upon resumption of payments, or increase the plan payments for a greater amount for only a 3 to 6 month period after payments resume. Which type you do depends on how far into the plan you are and whether you can afford the increased payments. Your attorney can discuss the be option for you.
If you find yourself falling behind in payments to your Chapter 13 trustee, don’t give up. Be sure and let your attorney know about the situation and they will schedule an appointment for you to review your options.
John Rogers, Kentucky Bankruptcy Attorney