Furloughed Due To Govt Shutdown? Your Chapter 13 Payments still due!

J Thomas Black
Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization
Posted on Oct 02, 2013

It didn't take long, a chapter 13 bankruptcy client emailed me this morning. She is a government contractor, and has been furloughed due to the government's budget problems and shutdown. Thankfully she is current on her plan payments at this time, even about a month ahead.

She wants my permission to stop her plan payments, but I'm sorry, the "confirmation order" that the bankruptcy judge signed when your case was approved, orders you to pay the payments. If you literally don't have the money to pay them, of course, you could not be held in "contempt of court" for not paying them. Hopefully the shutdown will be over soon, if these politicians will get off their rear-ends and do their job!

But if you do become delinquent on plan payments because of the shutdown, you would have several options. For one thing the Trustee's here in Houston don't typically file motions to dismiss for non-payment for 60 days. Then it may be 1 or 2 months until the hearing. Then you could ask for a continuance of a month, or file a motion to modify your plan.

Worst case you could allow your current chapter 13 case to dismiss, and then file a new case once this ridiculous shutdown is over.

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