While this may be an option there are many consequences to consider before we make that request to the Chapter 13 bankruptcy judge. If you are unable to move forward with your Chapter 13 case, it may be possible to ask the bankruptcy judge to convert your Chapter 13 case to a Chapter 7 case. Of course, we want your Chapter 13 debt consolidation plan to move forward so that we can protect all the assets of the estate and to prevent the creditors from pursuing collection actions against you. Because of the missed payments this will allow your Chapter 13 bankruptcy plan to move forward. If this is the case, then the court may allow you to resume your payments or the court may order that your Chapter 13 plan payments be increased. We may be able to show that the non-payment of your Chapter 13 plan was beyond your control. To avoid this process, we stress that you must make your Chapter 13 payment and if you can't please contact us immediately! Most debtors become terribly upset if they receive a motion to dismiss their Chapter 13 case. The creditors would then be able to proceed with any garnishment efforts, repossession of your vehicles, or foreclosure on your home. If you case is dismissed, this will lift the automatic stay and your creditors can proceed with all of their collection efforts against you. The bankruptcy judge will be the one to hear the motion to dismiss and if granted your case will be dismissed and you will no longer have the protection of the bankruptcy court. If you stop making your Chapter 13 payments, the bankruptcy trustee will likely move to dismiss your Chapter 13 case for non-payment. It must be stressed that if you do not make your Chapter 13 debt consolidation payments that you will not receive a discharge from the court. In some situations, we may be able to reduce a payment based upon a client's reduction of income. We have seen events such as medical emergencies, job loss, reduction of hours, or even a divorce which make it impossible for the debtor to maintain the Chapter 13 payments. However, there are events which can occur in a debtor’s life which makes it impossible to pay some of their Chapter 13 payments. This is why it is imperative that we work with our clients to calculate a Chapter 13 payment in which they can afford. This will also involve filing a separate motion with the court to ask for an extension of the automatic stay, assuming that you file within a year of the dismissal.From the beginning of your Chapter 13 case, our Montgomery bankruptcy attorneys and Selma bankruptcy attorneys stress that you must make your Chapter 13 plan payments. You can file again as soon as you qualify for either Chapter 7 or Chapter 13. However, if you have suffered a substantial financial blow and cannot convert to Chapter 7, this may be your only option if you cannot get a hardship discharge. Until and unless you file again, you will lose the protections provided by bankruptcy, such as the automatic stay. This discharge is rarely granted but may be worth exploring if you have few other options.įailing to respond to a motion to dismiss likely will result in a dismissal without prejudice, which allows a debtor to refile at any point. A hardship discharge is only available if the circumstances causing the hardship were outside the debtor’s control. Justia offers a lawyer directory to simplify researching, comparing, and contacting attorneys who fit your legal needs.ĭebtors who are facing extreme challenges may apply for an early discharge if they cannot modify their plan, and they have paid creditors to the extent that they would have paid them in a liquidation bankruptcy under Chapter 7. It is usually a good idea to hire a bankruptcy lawyer in any Chapter 13 bankruptcy, but especially when defending against a motion to dismiss. They might also explain why the situation that disrupted their payments was unforeseen and temporary. If they are arguing that they can solve the problem, the debtor will want to propose a clear plan for addressing it. This might involve providing copies of pay stubs that show deductions from their wages to make payments, for example. If they are arguing that the trustee is wrong, they should carefully document the reasons why the trustee is unjustified in seeking a dismissal. They usually have just 21 days to respond, and it is critical to comply with this deadline.Ī debtor responding to a Chapter 13 motion to dismiss might argue that the trustee is wrong, or they might argue that they can solve the problem. Fortunately, a debtor has an opportunity to object to this motion. This means that their debts would not be discharged because the case would be considered unsuccessful. If a debtor fails to keep up with payments under their repayment plan in a Chapter 13 bankruptcy, the bankruptcy trustee may file a motion to dismiss their case.
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