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When A Bankruptcy Repayment Plan Is Not Affordable

On behalf of Musselwhite, Meinhart & Staples posted in bankruptcy on Tuesday, December 5, 2017.

When a Chapter 13 repayment plan is created, the amount owed monthly is determined by a person’s income at the time of plan approval. These repayment plans are good for three to five years. A lot can happen during that time.  What do you do when the repayment plan is no longer affordable?

If an individual on a Chapter 13 repayment plan has to take pay cut or suffers a medical issue, among other things, that prevents him or her from working, keeping up with the court ordered payments can be difficult. If one misses a payment, the court may dismiss the bankruptcy completely, allowing creditors the right to restart their attempts to collect.

Before missing a payment, Kentucky residents who have experienced a change in income level and are no longer able to meet the terms of their bankruptcy repayment plans may have a few options in order to keep their cases active. First, it may be possible to arrange partial payments with the trustee. If that does not work, it may be possible to request a modification to the repayment plan. An experienced attorney will have the ability to review the details of one’s new financial situation and thoroughly explain all of one’s available options.

Source:, “Defer Chapter 13 Bankruptcy Payments To Avoid Missing A Payment?” Justin Harelik, accessed Nov. 20, 2017

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