Clients considering a Chapter 13 bankruptcy are often afraid they’ll be stuck in a payment plan they can’t afford if something changes.
Your life doesn’t stop just because you file Chapter 13 bankruptcy so the chances of unforeseen circumstances disrupting a budget are good.
Some clients go the entire 3-5 years without needing a modification but don’t worry if something happens that requires a change in the plan payment.
Unforeseen Circumstances May Include
- Job loss
- car repairs
- home repairs
- medical bills,
- tax debt.
All of these may require that a plan be modified to address a borrower’s new budget.
To modify a plan a motion is filed with the court explaining why the modification is needed and what the new payment plan is to be.
The process for obtaining approval of a modified Chapter 13 plan generally takes at least 45 days so modifications can’t be done quickly to reflect month-to-month changes in a borrower’s budget. But borrowers can be confident they won’t have to continue making a payment they can’t afford.
If you’re in a Chapter 13 plan currently and are anticipating some change that will make you unable to make your plan payment contact us as soon as possible so we can propose the necessary modification.