Today’s Question: Can I Still Use Afterpay If I Filed Chapter 13 Bankruptcy? (Klarna Closed My Account)
If you filed Chapter 13 bankruptcy and are trying to rebuild your life financially, you may be wondering:
“Can I still use Afterpay?”
“Will Afterpay close my account like Klarna did?”
“Has anyone used Afterpay while in Chapter 13?”
This is a very common question — especially because many people rely on Buy Now Pay Later services like:
- Afterpay
- Klarna
- Affirm
- Sezzle
- Zip
These services have become popular because they allow people to split purchases into smaller payments without using traditional credit cards.
But once you file bankruptcy, things change.
Let’s break down what you need to know.
Why Klarna Closed Your Account After Filing Chapter 13
Many people are surprised when they file bankruptcy and suddenly see accounts closed.
But Klarna (and other Buy Now Pay Later companies) often close accounts because:
Bankruptcy is considered a major credit event.
Even though Chapter 13 is designed to help people reorganize debt and get back on track, companies still view it as a risk factor.
Many BNPL companies have policies that automatically close or restrict accounts when they see a bankruptcy filing appear on your credit report.
So if Klarna closed your account, you are not alone.
That is very common.
Can You Use Afterpay While in Chapter 13?
The answer is: possibly, but it depends.
Afterpay is still a form of credit, even though it may not feel like it.
Most Afterpay purchases involve:
- a payment plan
- a repayment obligation
- scheduled future payments
That means you are entering into a new debt agreement.
And in Chapter 13, new debt is something you must be careful with.
Chapter 13 Bankruptcy and New Credit
In a Chapter 13 case, you are on a court-approved repayment plan that lasts 3 to 5 years.
During that time, many bankruptcy courts require you to obtain permission before taking on new debt — especially if it’s significant.
Some Chapter 13 plans or trustees may require permission for:
- new credit cards
- car loans
- personal loans
- financing furniture or appliances
- payday loans
- and sometimes even Buy Now Pay Later accounts
Because the court wants to make sure your monthly budget can support your plan payment.
Is Afterpay Considered “New Debt”?
Yes.
Even though it’s broken into smaller payments, Afterpay is still a financial obligation.
If you make a purchase today and owe payments over the next several weeks, that is debt.
So the bigger question becomes:
Will your trustee or bankruptcy court consider Afterpay a problem?
That depends on your case, trustee rules, and the amount of the purchase.
Will Afterpay Close Your Account Like Klarna?
It might.
Some people report being able to keep Afterpay while in Chapter 13.
Others find that Afterpay closes or limits their account after bankruptcy appears on their credit report.
Afterpay may:
- lower spending limits
- require larger upfront payments
- deny purchases
- close the account completely
These companies are private businesses, and they can choose whether to offer you credit.
So there is no guarantee.
Has Anyone Used Afterpay After Filing Chapter 13?
Yes — some people have.
Many Chapter 13 filers say they were able to continue using Afterpay for small purchases like:
- clothing
- household items
- shoes
- school supplies
- gifts
However, it’s important to understand:
Just because someone else did it doesn’t mean it’s safe for every case.
Every bankruptcy plan is different.
Some trustees are strict about new debt, and others are more lenient.
Why Using Afterpay Could Become a Problem
Using Afterpay might seem harmless, but it can create issues if:
- you miss a payment
- it causes overdrafts
- it impacts your ability to make your Chapter 13 payment
- the trustee reviews your bank statements and sees repeated BNPL payments
- you start relying on BNPL regularly for necessities
Even small recurring payments can raise questions if the trustee believes you are living beyond the budget submitted to the court.
What Happens If You Use Afterpay Without Permission?
In many cases, nothing happens — especially if the amounts are small and you stay current.
But in some situations, using new credit without approval could lead to:
- trustee objections
- a request for updated budget information
- complications in your bankruptcy case
- in extreme situations, dismissal of the case
This is why it is always better to ask your attorney first before taking on any new credit obligation.
The Safer Alternative: Use Debit or Cash While in Chapter 13
Chapter 13 is meant to be a time to stabilize finances.
If possible, the safest approach is:
- pay as you go
- avoid installment plans
- avoid new debt
- build an emergency cushion
It may not feel convenient, but it prevents setbacks.
Can You Rebuild Credit Without Afterpay?
Yes.
Many Chapter 13 filers rebuild credit through safer options like:
- secured credit cards (with court approval if needed)
- paying rent and utilities on time
- budgeting consistently
- staying current on plan payments
In many cases, credit improves significantly after completing Chapter 13.
The Bottom Line
If you filed Chapter 13 and Klarna closed your account:
✅ That is very common
⚠️ Afterpay may still allow you to use the account, but it depends
⚠️ Afterpay is still considered new debt
❗ You should be careful because Chapter 13 rules often limit new credit
✅ Always speak to your bankruptcy attorney before using Buy Now Pay Later services
Final Thought: Chapter 13 Is a Court-Supervised Process
Chapter 13 can be an incredible tool to stop foreclosure, catch up on debt, and regain control of your finances.
But it comes with rules — and one of the biggest rules is avoiding new debt unless it’s necessary and approved.
If you are unsure whether Afterpay is allowed in your case, the best step is to ask your bankruptcy attorney before using it.
A quick question now can prevent a major headache later.
Need Help Understanding Chapter 13 Rules?
If you are currently in Chapter 13 and unsure what you can and cannot do financially, contact our office. We can help you understand your rights, trustee expectations, and how to successfully complete your bankruptcy.
The goal is a fresh start — and finishing strong.
