Chapter 13 bankruptcy is a court-approved repayment plan that helps debtors regain control of
their finances. Depending on outstanding debt the plan can last anywhere
from 3 to 5 years. The payments are created based on the affordability
of the debtor. Most debtors find payments scheduled in the plan to be
more affordable than what they were paying before they filed. Sometimes
debtors experience a change in their payments and are unsure why it occurred.
Yet, there are a few details debtors should keep in mind that may cause
their payment to increase.
Income changes: If you experience an increase of income or receive overtime pay this could
be factored into revising your monthly payment amount. Keep in mind, the
amount of the increase may not automatically affect your Chapter 13 payment.
It may depend on whether or not the increase in income is permanent or
Car loan payments: Many file bankruptcy to help keep their property such as their vehicle.
But some may pay off their loan before the bankruptcy process is complete.
This means the debtor would have additional funds to place on other debt
obligations associated with your bankruptcy plan.
If you borrowed against retirement funds: Some debtors may be making payments against their retirement account if
they obtained a loan from it prior to filing bankruptcy. When they have
completed repaying the loan Chapter 13 payments can increase if additional
income can be placed toward creditors.
Support payments (child, alimony and spousal): If support payments you’ve been making happen to end during the course
of your bankruptcy it is possible bankruptcy payments can increase.
Be sure to keep your trustee updated with any changes that occur to your
financial situation during bankruptcy.