What to Do When You Have Been Laid Off Due to Covid-19 and Cannot Make Your Chapter 13 Plan Payments

What to Do When You Have Been Laid Off Due to Covid-19 and Cannot Make Your Chapter 13 Plan Payments

When you are in a Chapter 13 repayment bankruptcy, you are required to make regular plan payments to the Bankruptcy Trustee. If you are not making all of your required plan payments, the Bankruptcy Court could dismiss your case.

If you are in a Chapter 13 bankruptcy and you have been laid off due to Covid-19, you must communicate this to your bankruptcy attorney. If you do not have an attorney, you must communicate to your Bankruptcy Trustee you have been laid off due to Covid-19.

The Chapter 13 Bankruptcy Trustees are agreeing to temporarily suspend plan payments during the time you are laid off. The Trustee will need to see documentation you have been laid off. The need to make your plan payments does not go away. If the Trustee agrees to temporarily suspend plan payments you are still required to make all of the plan payments by the end of the three to five year repayment period.

The above information is a general overview and is not intended to be used as legal advice. If you are considering filing for bankruptcy, the best thing to do is call our office at 248-557-3645 and schedule a free consultation so you can receive advice which is tailored to your specific circumstances.

By: Michael Benkstein, Esq.

Managing Attorney, Bankruptcy Department

The Law Offices of Joumana Kayrouz, PLLC

1000 Town Center

Suite 800

Southfield, MI 48075

(phone) 248-557-3645

(fax) 248-200-0645

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