What happens to late payments during Chapter 13 Bankruptcy?

In California, a Chapter 13 Bankruptcy is a debt repayment plan that allows individuals to reorganize their finances, repay some of their debt, and still keep their property. During this process, late payments are handled in a few different ways. First, the bankruptcy trustee will create a repayment plan. This plan will include all of the debts you owe to creditors which will be repaid over time. It is important to keep up with these payments. If you make late payments during this process, the bankruptcy court will take action in order to protect the rights of the creditors. This could include forcing the bankruptcy to convert to a Chapter 7, which is a liquidation of non-exempt assets. The other possibility is that the court will require you to make up the payments that were late. This could involve making higher payments in the near future or the court may adjust your repayment schedule in order to make up for the late payments. If the late payments continue over an extended period of time, the court may even dismiss your bankruptcy case. If this happens, your creditors will be free to pursue collection actions against you. In order to avoid this, make sure to keep up with your payments and inform the court in advance if you are unable to do so for any reason. Overall, late payments during Chapter 13 Bankruptcy in California can lead to serious consequences. Therefore, it is important to keep up with your repayment plan in order to avoid any negative consequences.

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What happens to late payments during Chapter 13 Bankruptcy?

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