subject: CC Brown law – Outcomes of Missed Bankruptcy Payments [print this page] CC Brown law Outcomes of Missed Bankruptcy Payments
The Bankruptcy payments are an important part of any Chapter 13 bankruptcy. A bankruptcy like this requires the individual to make monthly payments towards his or her debt to the bankruptcy trustee. The trustee then pays the debts of the individual according to the bankruptcy plan. However, the bankruptcy will likely end with the discharge of many debts, including most unsecured credit cards or non priority debts. This plan is dependent on the individual making all necessary payments, though.
The Importance of Bankruptcy Payments:
Once a person files Chapter 13, he or she will have a repayment plan in place. This plan outlines who will receive payments during the bankruptcy repayment period and how much is paid. It is important that this monthly payment amount be affordable to the individual, which will reduce the chances that he or she will stop making payments. If you cannot afford this plan, you may need to consider making other bankruptcy arrangements, such as filing Chapter 7 bankruptcy instead.
When the bankruptcy filer does miss a payment, this will trigger a series of situations to occur.
The bankruptcy trustee should be notified by you of any payment problems. Explain why you cannot make the payment. If the problem is ongoing, such as not having enough income, the trustee may determine it is necessary to stop the bankruptcy proceedings and consider Chapter 7 instead.
If the situation is a onetime problem, such as the individual had a significant time off from work due to illness, it may be possible for the court to tack that payment on to the end of the plan. As long as you continue to make payments after that point, the trustee may allow the process to continue.
In situations where you are missing more than one payment, it is likely that the bankruptcy trustee will try to convert the bankruptcy to a Chapter 7, assuming you are in contact with the trustee to do this.
One of the worst things you can do is to not communicate with the bankruptcy trustee about your Bankruptcy payments. Inform the trustee of any problems. So, the bankruptcy may be thrown out and you may have to repay all of the debt you owe in full.
Getting Legal Aid:
For those struggling with bankruptcy and making bankruptcy payments, speak with an attorney. It may be possible to change the terms of the bankruptcy repayment to make the monthly payments more affordable.
