DAY 14 — What Happens If You Miss a Chapter 13 Payment?
Week: Week 2: Decision
Intent: High-Intent | Chapter 13 Missed Payment
Missing a Chapter 13 payment is serious but not always fatal to your case. Learn what happens, how to recover, and when you can modify your plan.
Missing a Chapter 13 payment doesn't automatically end your case, but it puts it at risk. If you miss payments and don't cure the deficiency, your trustee can file a motion to dismiss your case — which would restart all collection actions, including foreclosure.
The Trustee's Role
Your Chapter 13 trustee monitors your payments. Missing one payment triggers a notice. Missing multiple payments typically leads to a motion to dismiss. You'll receive notice and an opportunity to respond.
Your Options When You Miss a Payment
Option 1: Cure the Deficiency
Pay the missed amount (plus any additional amounts now due) to bring the plan current. This is the simplest option if the missed payment was temporary.
Option 2: Modify Your Plan
If your income has permanently decreased, you can file a motion to modify your Chapter 13 plan. This can lower your monthly payment, extend your plan (up to 5 years total), or adjust what's paid to unsecured creditors.
Option 3: Convert to Chapter 7
If you no longer have the income to sustain a Chapter 13 plan, you may be able to convert your case to Chapter 7 — provided you now qualify under the means test.
Option 4: Hardship Discharge
In very limited circumstances, if plan failure is due to circumstances beyond your control and you've already paid creditors at least what they'd receive in Chapter 7, you may qualify for an early hardship discharge.
What Dismissal Means
If your case is dismissed, all protections of bankruptcy immediately end. The automatic stay lifts. Foreclosure can resume. Wage garnishments restart. It's as if you never filed — except the filing appears on your credit report.
Maryland-Specific Insight
In the District of Maryland, trustees typically work with debtors on first-time payment issues. Communication is key. Contacting your attorney the moment you anticipate a missed payment — not after — gives you the best chance of resolution.
Reality Check
Life happens. Job loss, medical emergencies, unexpected expenses — these can disrupt any budget. Chapter 13 is designed with some flexibility, but it requires active management. Having an attorney in your corner who knows when and how to modify is essential.
Related Questions
→ How Chapter 13 Payments Are Calculated?
→ What Happens If My Chapter 13 Case Is Dismissed?
→ Is Chapter 13 Better Than Chapter 7?
→ Can Bankruptcy Stop a Foreclosure Sale?
