Chapter 13 Post-Confirmation Information

According to your plan, you will be obligated to continue plan payments the amount and length of your plan as confirmed. Failure to make timely payments to the Trustee will result in eventual dismissal of your case as debts under Chapter 13 are not discharged until all payments have been made. In other words, failure to make timely payments will result in plan default, which will eventually result in dismissal and the undoing of everything that has been previously done to assist you with your debt problems.

Certainly, circumstances may change which may require plan modification. Debtors unable to make plan payments for a short period of time may contact their attorney to petition the court for abatement or suspension of their payments on a showing of such good cause, which, if approved by the court, will allow the case to continue without plan payments being made. It should be noted, however, that if the plan is approaching the five year maximum and if payments are suspended, this will result in an increase in payments once they are resumed in order to complete within the required sixty month period. Again, it is your obligation to contact your attorney to make those changes on your behalf.

The obligation to pay pursuant to the confirmed Chapter 13 plan rests squarely with you, the Chapter 13 debtor. If a motion to dismiss is filed in your case, our practice is to send the letter along with the Trustee's motion, and await a response from you, the client. If no response is made, then we do not object to the motion to dismiss. There may be options upon dismissal including conversion, hardship, or suspension of payments, however you MUST contact us to move forward.

11 U.S.C. Section 1305 describes the procedure for the filing and allowance of post petition claims. The general rule in Chapter 13 cases is that a debtor is on a "cash and carry basis" during the life of a Chapter 13 plan, and is not permitted to incur any new debt without prior approval of the Bankruptcy Court after all existing creditors and the Trustee have been notified of this intent. A common situation is the debtor who has insufficient or no health insurance coverage, and incurs new medical bills during the pendency of the Chapter 13 plan. These creditors can be included within the plan, but as post petition claims they must be paid in full and can result in a significant increase in plan payments. If the debtor can not increase plan payments, then the case would be subject to dismissal for lack of feasibility.

If you want to borrow money, we must be contacted to motion the Court and notify the Trustee and creditors for authorization. If you incur a windfall or inheritance during the remainder of your plan you must contact our office so that we may contact the Trustee and the creditors regarding these new funds and file a motion.

Please note that you MUST keep our office apprised of your new address and new phone numbers. Otherwise, this may prevent us in helping you obtain your discharge that you will have earned after completing all the plan payments.