Steps to Appeal Chapter 13 Dismissal For Non-Payment

As the cost of living increases throughout the nation, many Americans are struggling to keep their homes from foreclosure. Filing a Chapter 13 bankruptcy allows homeowners to protect the equity in their home while undergoing a reorganization of their debts. Individuals who are earning regular monthly income may qualify for Chapter 13 and be allowed to keep their homes and cars while repaying their debts through a reduced payment plan. Debtors are required to make a monthly payment to the bankruptcy trustee assigned to their case, who then distributes the money to their creditors. The terms of the plan can last for three to five years and when the case in concluded, the petitioner can receive a discharge of all their unsecured debts. A Chapter 13 dismissal for non payment can be initiated by the trustee when the debtor fails to make their monthly payments as outlined in the repayment plan approved by the court.

Procedure in Filing a Notice of Appeal

Once the federal bankruptcy court has approved a Chapter 13 repayment plan, the debtor is legally bound to make monthly payments to the trustee. If they fail to live up to the agreement, the trustee can file a “Motion to Dismiss”. Debtors who are experiencing a temporary financial loss due to a reduction in income may file a “Motion to Modify Plan Payments” in order to avoid their case being dismissed. If you wish to appeal dismissal of Chapter 13 bankruptcy, the following rules apply to the case:

• Under rule 8002 of the U.S. federal bankruptcy code, petitioners are granted 14 days in which they can file a notice of appeal with the bankruptcy court. During this period, a petitioner may file a motion asking the court’s permission for an extension of time in order to file a notice of appeal. If the appeal is approved, the case will be heard by the Bankruptcy Appellate Panel or a U.S. District Court judge.

• The next step in the process is for the petitioner to file a brief with the court, outlining all of the reasons as to why the appeal should be granted. The appellees then have 14 days to file a response to the petitioner’s brief.

• On the day of the hearing, the petitioner or their legal counsel can present oral arguments about the case. The court will rule on any outstanding motions and make a determination whether to uphold the dismissal, choose to amend the original order or overturn it entirely.

If the order to dismiss the case is upheld, the petitioner then has an additional 14 days to file a motion to rehear the case. If the bankruptcy petition is dismissed, the debtor must wait 180 days before refilling their case.

Obtaining Legal Intervention

When an individual has had their Chapter 13 case dismissed for non-payment, they are no longer protected from their creditors. The repercussions can be severe and the automatic stay no longer protects the debtor. All of their debts revert to the pre-bankruptcy filing status and collection agencies may pursue legal action and obtain a judgment against them, resulting in a garnishment of their wages. A bankruptcy attorney may be able to intervene on your behalf and request a hardship discharge when their financial circumstances have dramatically changed through no fault of their own.