No one plans on dramatic financial changes, but they happen. When changes do arise to an individual in Chapter 13 bankruptcy, they might be misled into believing there is no other option than sticking to their schedule of set monthly payments. But they might be surprised to find that Chapter 13 bankruptcy has a great deal of flexibility. Before we discuss options, it is important to note that payments are not something you want to ignore. You must make all of your Chapter 13 payments in full and on time because if you do happen to miss a payment, the trustee may drop or dismiss your case. Were that to happen, the court cannot protect your property from creditors. However, if you decided that you no longer want to make payments on your Chapter 13 bankruptcy, you do have several options.

For starters, you can convert the Chapter 13 bankruptcy into Chapter 7. A debtor is eligible to make a conversion to Chapter 7 at any time by simply filling out a ‘Request for Conversion’ form at the Clerk’s office. After that takes place, the debtor no longer has to make Chapter 13 payments. An example where this might be a good option is if a person filed for Chapter 13 for a very specific reason such as trying to catch up on car loan or home mortgage to prevent a loss from foreclosure. However, if the debtor still cannot keep up with payments in Chapter 13, it wouldn’t make sense to make payments any longer, and Chapter 7 would be a favorable alternative.

The second option, if you no longer want to make payments on your Chapter 13 bankruptcy, is through a voluntary dismissal. This is an option that is free to debtors at any time. If a person filed for Chapter 13 in an attempt to catch up with car or mortgage payments and is successful, they may no longer want to be in Chapter 13. In this option, debtors are no longer required to make monthly payments. However, if this is carried out before, they will not receive a discharge.

Another option is to amend the Chapter 13 plan. Options in amending the plan can be as simple as adjusting the payment schedule, reduce the monthly payments, or even extending the length of a plan. There are some limitations on these changes, for example you cannot extend the length of the plan for more than five years from the time of your first payment. However, if you have a reduction in pay due to a decrease in income, the amount of your monthly payment can be changed. The process involves a motion to amend the plan to the Chapter 13 trustee and all involved creditors.

If you have questions about Chapter 13 or want to find out how to get rid of your debt for good, why not call a firm that focuses exclusively on Chapter 7 and Chapter 13 bankruptcies. Lincoln Law is the nation’s leading bankruptcy law firm and can put an end to the hassle of collection calls, help you keep your home and protect your credit score. For information on how to file for bankruptcy in Utah, call Lincoln Law at 800-722-6578 for a free same-day consultation.