During your Chapter 13 repayment period, you’ll live on a strict budget and pay the bankruptcy trustee a set amount of money to take care of your restructured debts. But what happens if you lose your job, or if your hours or wages get cut? A bankruptcy lawyer will have a solution for you, so contact a law firm right away.
Modifying the Chapter 13 Bankruptcy Plan
One option is to request that the court modify your Chapter 13 repayment plan. You can request a modification if your circumstances change significantly, such as increased expenses due to an illness or decreased income due to wage cuts and job loss. If the court hasn’t yet finalized your plan, you can ask your lawyer to file an amended plan. If the plan is finalized, your lawyer will request a hearing date, at which he or she will need to show proof of your loss of income. The modified plan should reduce the amount of the payments.
Converting to a Chapter 7 Bankruptcy
People file for a Chapter 13 bankruptcy if they earn too much money to qualify for Chapter 7. Now that you’ve suffered job loss, you may qualify for Chapter 7. Talk to your attorney about the merits of converting to this type of bankruptcy, which would eliminate your dischargeable debts if approved.
If anything changes during your Chapter 13 repayment period, you can contact the bankruptcy lawyers at Cutler & Associates, Ltd. We’ll help you understand the legal ramifications of the situation, and work toward a reasonable solution that puts you back on track. Clients in Schaumburg and the surrounding areas can call our law firm at (847) 961-4572.