The Chapter 13 trustee collects your monthly payment and distributes it to creditors according to the confirmed plan. Most courts require payroll deduction - your employer sends the payment directly to the trustee before you receive your paycheck.
How Payments Are Collected
The Chapter 13 trustee collects your monthly payment and distributes it to creditors according to the confirmed plan. Most courts require payroll deduction - your employer sends the payment directly to the trustee before you receive your paycheck.
If you are self-employed or your employer cannot accommodate payroll deduction, you make payments directly to the trustee, typically by check, money order, or electronic payment.
What Happens If You Miss a Payment
Missing a plan payment is one of the most common reasons for Chapter 13 dismissal. The trustee will typically file a motion to dismiss if you fall behind. You usually have an opportunity to cure the arrears before the court grants the motion.
If you anticipate missing a payment due to temporary circumstances, contact your attorney (or the trustee if pro se) immediately. Proactive communication is far more effective than waiting for a motion to dismiss.
Grace Periods and Catch-Up
Most trustees allow a short grace period (typically 10-15 days) before reporting a missed payment. However, this varies by district and trustee. Do not rely on grace periods as a regular practice.
If you fall behind, you may be able to catch up by making extra payments or by filing a plan modification to adjust the payment schedule.
Learn about plan modification
Plan Modification Guide