The Implications of Missing a Chapter 13 Bankruptcy Payment

Chapter 13 bankruptcy is a financial lifeline for many individuals overwhelmed by debt. By consolidating debts and arranging a payment plan, Chapter 13 allows debtors to repay their creditors over a period of three to five years, typically without the need to liquidate assets.

However, what happens when a debtor can’t make a Chapter 13 bankruptcy payment? The answer is nuanced, and the outcome largely depends on the debtor’s individual circumstances and actions.

Dismissal of the Case

The most immediate risk when you can’t make a Chapter 13 payment is the dismissal of your bankruptcy case.

Bankruptcy courts require consistency in payment, and if you miss payments, you risk having your case dismissed. This means you would lose the protection of the bankruptcy court, and your creditors would be free to pursue collection actions.

This can include lawsuits, garnishments, and foreclosure on your property. If you’ve been relying on the bankruptcy’s stay order to prevent these actions, the dismissal of your case could have significant implications.

Conversion to Chapter 7

Another potential consequence of failing to make Chapter 13 payments is the conversion of your bankruptcy case to Chapter 7.

Chapter 7 is a different form of bankruptcy where a trustee sells the debtor’s non-exempt assets to repay creditors.

This might be a suitable option for some people, but it’s important to remember that not all debts are dischargeable in a Chapter 7 bankruptcy, and there are specific income-related eligibility requirements.

Conversion isn’t automatic, so you should discuss this option with a bankruptcy attorney or advisor.

Modification of the Payment Plan

If your financial circumstances have changed and you find yourself unable to maintain the current payment plan, it might be possible to seek a modification.

For instance, if your income has significantly decreased, or you’ve incurred unexpected expenses, the court might allow you to revise the terms of your Chapter 13 plan to lower your payments.

You’ll need to provide evidence of these changes and demonstrate that you can’t continue payments at the current level. This process requires court approval and will involve negotiation with your creditors.

Hardship Discharge

In some rare situations, the court might grant a hardship discharge if you’re unable to complete your Chapter 13 plan due to circumstances beyond your control.

This typically requires proof that the circumstances preventing plan completion are permanent, that creditors have received at least as much as they would in a Chapter 7 liquidation case, and that modification of the plan isn’t feasible.

A hardship discharge operates similarly to a Chapter 7 discharge, but it’s not as broad, and some types of debt may remain.

Catch-up on Payments

If you’ve only missed a payment or two, your bankruptcy trustee might allow you to catch up over a certain period. This is particularly likely if you’ve generally been consistent with your payments and have a reasonable explanation for the temporary lapse.



Navigating the complexities of bankruptcy is a daunting task, particularly when faced with the prospect of not being able to make your Chapter 13 payments.

If you find yourself in such a predicament, it’s vital to take immediate action. Contact your bankruptcy attorney or trustee as soon as possible to discuss your options. Depending on your circumstances, you might be able to modify your payment plan, convert to a Chapter 7 bankruptcy, or in rare cases, obtain a hardship discharge.

Regardless of the route you take, remember that open communication is essential. Your attorney or trustee can provide guidance and advice, but only if they’re aware of your situation.

Keep them informed about any financial changes or difficulties you face, and work with them to identify the best solution for your circumstances. If your circumstances change, there are mechanisms in place to adjust your plan accordingly.

Falling behind on Chapter 13 payments can present serious challenges, but it does not necessarily spell disaster. There are multiple avenues available to navigate this situation. However, it is important to be proactive and not let missed payments accumulate without addressing the issue.

Hiring an Attorney

Bankruptcy laws can be intricate and vary by state, so you should always consult with an experienced bankruptcy attorney to understand your options fully. Your bankruptcy attorney can help you understand the legal implications and potential outcomes based on your unique situation.

They can also guide you through the process of modifying your payment plan or converting your case to Chapter 7 if needed.

Finally, always remember the goal of bankruptcy: to provide you with a fresh start. This process is not meant to be punitive, but rather to give you the tools and structure to rebuild your financial life.

Don’t be discouraged by missing a payment, instead, use it as a catalyst to reassess your plan and make the necessary adjustments.

The road to financial stability may be challenging, but with determination and the right support, it is certainly attainable.


Learn More

At Blue Bee Bankruptcy, our lawyers are highly experienced in bankruptcy options. More importantly, we understand that each case we receive is unique and each client has different needs and goals. We will discuss these signs with you and decide the best route to take.

We strive to help our clients rebuild their lives and take steps toward a better financial future through filing. 


Best Bankruptcy Attorneys in Salt Lake City


If you’re dealing with the potential of bankruptcy, give us a call. Our team will work to help you by reviewing all of the options our firm has available. We will ensure you’ll get the best possible outcome for your situation.

Get in touch today so we can start working on either halting bankruptcies or preventing them from taking place altogether!

Contact Us Today For Help! You can schedule your free consultation online or call us at (801) 285-0980.


Blue Bee Bankruptcy Law Firm

Rebuild Your Life After Bankruptcy
Get FREE information on rebuilding your credit.
Start Today