Can I get my chapter 13 plan payment lowered?

  • Yes, but you need a pretty good reason to submit to the court.

    When we file a chapter 13, you plan payment is based on any secured payments you’re making (like car payments), plus any mortgage arrears we are paying back, and your plan may be paying back a pot of money to your creditors based on your income level at the time we filed.

    Getting the payment lowered can happen if we file a Motion to Modify Confirmed Chapter 13 Plan, but we usually need to argue that your income has gone down, your family size has gone up, or something has happened with the mortgage.

    First, if your income has gone down, we can move to reduce your plan payments if, and only if, you were originally paying a pot of money to your unsecured creditors.  Even then, we need to argue that the income loss is permanent, and not just a short-term, temporary loss of income.

    Second, if your family size has gone up (a new baby), we can reduce your payments, if and only if you were paying a pot of money to unsecured creditors.

    Third, if you have an approved permanent loan modification, or if you stopped making payments on your home and gave up on it and the mortgage company has been granted a relief from the automatic stay on you home, then we can move to reduce your plan payments if you had formerly been paying back mortgage arrears as part of your plan.

    So the circumstances must be permanent, and then we can make the attempt.

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