Many people thinking about a chapter 13 bankruptcy are worried about whether they will get stuck in a repayment plan that they might not be able to afford a year or two later.

The thing to bear in mind is: your payment plan is, in most cases, not written in stone. The courts understand that things happen in your life, such as illness, job loss, or the birth of another child, that can make it no longer possible for you to meet the current plan requirements. That is why there is a procedure to file a modified plan.

Some people are in bankruptcy to give them time to address "must-pay" debts, such as taxes or a mortgage arrearage, over time. If this requires a payment over the maximum plan length of five years, then they may have few choices available to them if they can no longer afford that payment. However, if it is just old credit card debt, medical bills, or an unpaid loan, then there are three options:

  1. Change the amount of the payment. 
  2. Extend the Term of the Plan. 
  3. Convert to a Chapter 7.

If you live in South Jersey and are considering filing bankruptcy, call my office at 856-432-4113 or contact me through this site for a free consultation to discuss your case. If you are looking for more information about bankruptcy, then download my free book,Top Questions People Ask About Filing Bankruptcy in New Jersey.

Steven J. Richardson
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Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.