What happens when I fail to make a payment in a Chapter 11 bankruptcy?

When someone fails to make a payment in a Chapter 11 bankruptcy in Virginia, it is called a default. A default means that the person has not paid the required amount that was specified in the bankruptcy agreement. A default can result in several actions by the court, including the dismissal of the case. That means the debtor no longer has protection from creditors, and the creditors can start taking action to collect the debt. The court can also convert the case from Chapter 11 to Chapter 7. This allows for the liquidation of the debtor’s assets in order to pay off their creditors. The court may also appoint a trustee to oversee the debtors’ assets and make sure they are used to pay off creditors. The court may also impose fees and other penalties on the debtor for the failure to make a payment. This could include the court charging them for the amount the court believes should have been paid. If a debtor fails to make payments for an extended period of time, the court can order the debtor to pay their creditors directly from their future income. It is important for debtors to take the required steps in Chapter 11 bankruptcy to avoid default. This includes establishing a payment plan with their creditors, and making sure to make the payments on time. Failing to do so could result in serious consequences.

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What happens when I fail to make a payment in a Chapter 11 bankruptcy?

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