If you’re in a Chapter 13 bankruptcy and struggling with your monthly payment, you’re not alone. Many people ask:
“Can I lower my Chapter 13 payment?”
“What if my income changed?”
“What if my expenses went up?”
The short answer is:
Yes — in many cases, a Chapter 13 payment can be lowered, but it depends on why your payment is high and what has changed since you filed.
Here’s how it works.
Why Chapter 13 Payments Are Set So High
Your Chapter 13 payment is based on several factors, including:
- your income at the time of filing
- your monthly living expenses
- priority debts (taxes, support)
- secured debt arrears (mortgage or car)
- non-exempt equity in property
- whether you are in a 100% repayment plan
Because these factors can change over time, your payment is not always permanent.
When You May Be Able to Lower Your Payment
You may qualify for a reduced payment if something significant has changed, such as:
✅ Loss of income
Job loss, reduced hours, or commission cuts.
✅ Increased expenses
Rent increases, childcare costs, higher insurance, or utility increases.
✅ Medical issues
New medical bills, illness, or disability.
✅ Divorce or separation
Loss of a spouse’s income or added expenses.
✅ Retirement
A drop in income due to retirement.
How a Chapter 13 Payment Is Lowered
To lower your payment, your attorney must file a motion to modify your Chapter 13 plan with the court.
This usually requires:
- updated pay stubs or proof of income
- an updated budget
- documentation supporting the change
The trustee and judge will review whether the new payment is reasonable and still complies with bankruptcy law.
When Lowering the Payment Is Harder
There are situations where lowering the payment may not be possible, including:
⚠️ If your plan is based on asset equity
If unsecured creditors must be paid in full due to non-exempt equity, the payment may not be reducible.
⚠️ If priority debts must be paid in full
Certain taxes and support arrears still must be paid regardless of income changes.
Other Options If You Can’t Lower the Payment
If modification isn’t enough, you may still have options, such as:
- extending the plan term (up to 60 months)
- temporarily suspending payments (in limited cases)
- converting to Chapter 7 (if you qualify)
- seeking a hardship discharge (rare)
Each option has risks and benefits.
What Happens If You Do Nothing?
Ignoring payment problems can lead to:
- trustee motions to dismiss
- loss of bankruptcy protection
- foreclosure or repossession restarting
- wage garnishments resuming
The sooner you act, the more flexibility you usually have.
The Bottom Line
Can you lower your Chapter 13 payment?
✅ Often yes — if your financial situation has changed
⚠️ It depends on why your payment is high
❗ You must request a modification through the court
✅ Acting early gives you the most options
Final Thought
Chapter 13 is meant to help people recover — not set them up to fail. If your payment no longer works, that doesn’t mean you’ve failed. It means the plan may need to be adjusted.
If you’re struggling, talk to your bankruptcy attorney sooner rather than later.
