My brother inlaw defaulted on his bk, he had been paying it for over 2 yrs , and lost his job a few months ago has not made a payment since feb. What should he expect to happen ? will the creditors and ca start calling?
Yes, he loses the protection of the automatic stay so collection activity can resume. He does have the option to convert the chapter 13 to a 7.
He will get a letter from the bankruptcy trustee soon, advising that he is behind in his payments. He should then contact his attorney within 5 days to schedule a hearing. If he can bring his past due payments current, he will be able to stay in his plan, if not, chapter 7 is an option or his creditors may again collect on the past due obligations. Money paid in but not disbursed may revert back to him.
