Here’s some good news if you are behind on child or spousal support, and are being relentlessly chased on that debt. Or are about to be.
If you are behind on support, your ex-spouse and support enforcement agencies have tremendous tools to use against you to make you catch up. The law does not give you much power to fight back, especially once you’ve fallen behind. But one way you CAN fight back is through a Chapter 13 “adjustment of debts.”
What Chapter 13 CAN Do—Freeze the Collection of Back Support against You
The filing of a Chapter 13 case on your behalf IMMEDIATELY stops your ex-spouse or support enforcement agency from pursuing you, your money, and your assets for the collection of BACK support. Even filing a Chapter 7 “straight bankruptcy” will not accomplish that.
This power of Chapter 13 is huge, because there is nothing else in the law that enables you unilaterally to stop the often very aggressive means used for collecting back child support. This includes stopping not just garnishments of wages and bank accounts, not just stopping the recording of liens against your home and vehicle, but also stopping the suspension of your personal and commercial driver’s licenses, and of your occupational and professional licenses. Most state’s laws provide for these kinds of collection tools to be used against you if you are behind on your support payments, so preventing their use can be absolutely crucial.
This is a “unilateral” power in that the protection goes into effect immediately, WITHOUT your ex-spouse or the support enforcement agency having any say about it happening. They DO get a say about whether and how long this protection against collection of back support continues. But even if they object, as long as you follow the rules your protection can in most cases continue indefinitely. If you are being aggressively hounded for being behind on support, having this power at your disposal can be very good news indeed.
What Chapter 13 CAN Do—Give You Time to Catch Up Based on YOUR Schedule
Chapter 13 is a 3-to-5-year payment program, one in which you usually pay only a part of your debts, and often only a relatively small part. You would usually have the entire length of your case to catch up on your support arrearage. Your Chapter 13 plan must show how you will pay the entire arrearage within the 3-to-5-year term of the plan. And then you must comply with those terms to keep up the protection against the collection efforts against you. But the length of time for catching up is infinitely generous compared to what most ex-spouses and support enforcement agencies would otherwise allow.
Not only do you have the 3-to-5-year period to catch up, generally you are allowed to pay other high-priority debts ahead of or at the same time as you are catching up on support. For example, you can often make payments on a vehicle or mortgage arrearage either ahead of or at the same time as making payments on the back support.
What Chapter 13 CAN Do—Lets You Pay Other Debts Less in Order to Pay the Back Support
In most Chapter 13 cases you must pay what you can afford to pay to your creditors during a 3-to-5-year period (the length of that period depending on a formula largely based on the amount of your income). As a result, the amount that you owe in support arrearage often just reduces dollar-for-dollar the amount you are paying to your other creditors.
Regardless of your own circumstances, if you must catch up on support arrearage, doing so through Chapter 13 is usually a very favorable way to do so. It is great news that you can use the power of Chapter 13 to stop the collection of support arrearage and be able to collect on your own reasonable terms.
What Chapter 13 Can’t Do
Neither Chapter 13 nor any other form of bankruptcy can write off (“discharge”) any child or spousal support arrearage. A support obligation is created by a state domestic relations court, and as it becomes due each month there is nothing in bankruptcy law that can undo that debt. Congress has decided that state courts’ decisions in this realm must be respected.
Same with ongoing support obligations—they can only be changed by going back to the state court which originally created the obligation. In fact the collection of ongoing monthly support obligations can’t be stopped even through your filing of a Chapter 13 case—it stops only the collection of already accrued support arrearage.