Filing chapter 13 bankruptcy is not a one-shot deal. You do have the ability to file another chapter 13 bankruptcy case should your first case fail states Chapter 13 bankruptcy attorney David Siegel. No one sets out to fail in bankruptcy. Debtor’s and their counsel wish to file a perfect chapter 13 petition and to have the debtor make all of the required payments under their repayment plan. Unfortunately, life throws different obstacles into the mix. One could lose a job halfway through a bankruptcy case under chapter 13. One can become ill and miss some much needed hours at work. One could get a divorce and lose that dual income that they had at the start of the chapter 13 case. Interest rates on mortgages can increase during the course of a chapter 13 bankruptcy case making payment to them unfeasible.
Events That Cause Chapter 13 To Fail
As you can see, many things can happen in a chapter 13 bankruptcy case that can cause the case to go awry. Do not fret. You do have the ability to refile another chapter 13 bankruptcy case and get another bite at the apple. Many times, people file repetitive chapter 13 bankruptcy cases. The first case is always the most difficult to navigate. This is the time where the debtor really doesn’t understand how difficult it is to not only make their current mortgage payments but also make a payment to the chapter 13 trustee on time for the next 3 to 5 years. Not every debtor is on payroll control. Not every debtor has the trustee payment coming out of their paycheck. Not every debtor is capable of budgeting what they really need to pay to the chapter 13 trustee in addition to the normal household expenses.
Another Opportunity
Thankfully, chapter 13 provides for another opportunity in the case of failure. In fact, it is only after we have failed repetitively that you the trustee or creditor will bring a motion to bar the debtor from the being able to file another chapter 13 bankruptcy case for 180 days. And remember, with every new chapter 13 bankruptcy case, there is a different attitude and typically a different dollar amount owed to the creditors. If the debtor can make the first case or second case last for a significant amount of time, then each time they refile the amount of debt will be less and less.
Plans Can Be Amended
If you are someone who is struggling with making a chapter 13 plan payment, your attorney may be able to modify the plan to make your life a little easier. Oftentimes, the creditors will file claims for less than what is owed and the plan could be amended to satisfy those debt over a 60 month period. Talk to your bankruptcy attorney about your case. If you do not like the information that your attorney is providing, do a little research on your own and possibly switch your Chapter 13 bankruptcy attorney in a future case.
