I am in a Chapter 13 and received a Motion to Dismiss for Failure to Make Plan Payments. Does that mean I am kicked out of the bankruptcy?

In a Chapter 13 bankruptcy there is a monthly payment made to the Chapter 13 trustee either by wage order where your employer sends the payments directly to the trustee or by money order that you send in every month. Making this on time monthly payment is a condition of the bankruptcy. Failure to makes these payments can result in a Motion to Dismiss by the trustee. This motion is the trustee asking the court that your case be dismissed for failure to comply with the conditions of the Chapter 13. So you are kicked out of the bankruptcy? No. There are several options in dealing with a Motion to Dismiss in a Chapter 13.

The simplest way to resolve a Motion to Dismiss for Failure to Make Plan Payments is to become current on the payments. When a Motion to Dismiss for Failure to Make Plan Payments is filed there is a response date listed on the Motion. If you are current by this date your attorney can respond to the motion stating that you are current. Upon the trustees review of your attorney’s response the trustee may determine that the Motion to Dismiss for Failure to Make Plan Payments is no longer necessary and therefore withdraw the motion.

If you are unable to be current by the response date your attorney can respond to the motion stating that you intend to become current. The response being filed to the Motion to Dismiss for Failure to Make Plan Payments triggers the motion to be set for a hearing. The simple filing of the response and scheduling of the hearing automatically gives you a little more time to become current as we are awaiting the hearing date. However, it is important that you are current on the hearing date to prevent dismissal of your case. As long as you are current by this date the Motion to Dismiss for Failure to Make Plan Payments will be denied.

If there was a change in circumstances or something can up that caused you to fall behind on your plan payments and you are unable to get caught up but would be able to afford the plan payments going forward an amended plan can be filed however we then require that a wage order be filed to prevent you falling behind on plan payments in the future.