Photo by Priscilla Du Preez on Unsplash If you’re considering bankruptcy, should you pay unpaid child/spousal support in the meantime? Might depend on whether you do Chapter 7 or 13. Our last three blog posts have been about what you should and should not do before filing bankruptcy. Three weeks ago we focused on keeping your assets, especially any retirement … Read More
This example shows how well Chapter 13 can protect you from aggressive collection of past-due support and give you a safe way to catch up. Today we put what we explained in the last three weeks of blog post into a sample Chapter 13 plan. It shows how powerfully Chapter 13 helps you if you owe past due child … Read More
If you owe unpaid support, Chapter 13 gives you a sensible, affordable, and sane way to catch up, while protected from support enforcement. The last two weeks we’ve shown how Chapter 13 can stop the collection of unpaid child and spousal support. First we talked about how this benefit is much better than Chapter 7 can provide. Then we … Read More
Chapter 13 is better than Chapter 7 if you need to stop the aggressive collection of past-due support, if you meet some ongoing conditions. Last week we showed how Chapter 13 stops the collection of past-due child and spousal support, while Chapter 7 doesn’t. But we ended by emphasizing that anyone can quickly lose this huge benefit of Chapter … Read More
If you are behind on child or spousal support, Chapter 13 is better because it stops collection of this unpaid support. Chapter 7 doesn’t. Last week we discussed situations in which Chapter 7 would help if you’re behind on child or spousal support payments. We made clear that Chapter 7 “straight bankruptcy” provides only limited help. Mostly it gives you relief … Read More
If you are behind on child or spousal support, Chapter 7 writes off all or most of your other debts so that you can catch up on your support. If you are behind on child or spousal support payments Chapter 7 may or may not be a good solution. Chapter 7 “straight bankruptcy” is the most common type … Read More
Chapter 7 prevents a support lien by discharging other debts so you can afford the support payments. Chapter 13 does so by stopping liens directly. Child and Spousal Support Liens If you fall behind on child or spousal support payments, your ex-spouse can put a lien on your home. (Most likely a lien can be imposed on your other … Read More
Bankruptcy does not discharge child or spousal support. The rare exception: if the support debt is not a “domestic support obligation.” We’re in a series of blog posts about special kinds of debt which bankruptcy may not discharge—write off. So far we’ve covered criminal fines and restitution, and income taxes. Child and spousal support are more like criminal debts … Read More
Neither Chapter 7 nor Chapter 13 stops ongoing child/spousal support payments. But Chapter 13 CAN stop collection of support arrearage. Most Debts Filing bankruptcy stops—or “stays”—the collection of most debts. (See Section 362(a) of the U.S. Bankruptcy Code about the “Automatic Stay.”) Then at the end of the bankruptcy case most debts are discharged—legally written off. (Sections 727 and 1328 of the Bankruptcy Code.) At that point … Read More
If you’re behind on support payments, filing under Chapter 13 can legally stop your ex-spouse and support enforcement from pursuing you.
A bankruptcy trustee would pay your “priority” debts ahead of other debts in an “asset case.” But what happens in a “no asset case”?
A support obligation is a very special kind of debt, and the resulting lien on your home has to be dealt with in a very special way.
If you have a child or spousal support lien on your home because you’re behind on support payments, with Chapter 13 you can safely protect the home. If you are behind on your support payments, your ex-spouse and support enforcement agencies have tremendous tools to use against you to try to force you to catch up. And if you own a … Read More
Unpaid support is the highest priority of the “priority” debts. Chapter 7 frees up money to pay it. Chapter 13 buys you time to do so.
One of the most important distinctions between these consumer bankruptcy options are how they help or donât help with support arrearage debt.
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