In previous posts, I have discussed that you must make your payments on a lease as the payments come due once you file your case. What happens to the payments if you have missed some payments prior to filing?

11 U.S.C. Section 365 of the United States Bankruptcy Code requires that if you agreement is a lease, you must cure the the missed payments within a reasonable time. Sometimes, an agreement can be reached between the leasing company and the debtor over what is a reasonable cure or repayment period. If an agreement cannot be reached, the a hearing is held regarding what a reasonable repayment would be.

 The judge hearing the case will enter an Order determining what he thinks is fair and reasonable. South Carolina judges have generally been very fair about giving a debtor a chance to cure missed payments.

 If a debtor has missed payments prior to filing, at any hearing before the judge, you must be prepared to show that you two different sets of facts.

 First you must show that whatever was stopping you from making payments has been fixed. You must show that you can now afford to make your payments because of a change in circumstances. The change could be something as simple as because of filing, other payments have been eliminated.

 Secondly, you must show a reasonable plan to catch up the missed payments. This period is sometimes many months or, in the right situation, pay the payments current in a few days after the hearing. The key is to show how the lease holder will become paid so that there are no further defaults.  

Call 843-571-4042 to schedule an appointment with Nathan Davis to discuss this and other issues.  With correct and complete information, the correct path you should take will become clear.

About Nathan Davis, Esquire

Born in Charleston, South Carolina, Nathan Davis has been practicing law for many years. Mr. Davis has a wide variety of experiences having practiced domestic relations, criminal law, social security law having also practiced collection law in the past. This knowledge is helpful when someone needs to restart their financial life. The practice is now primarily bankruptcy and debtor representation work, but, Mr. Davis continues to also practice real estate law, trusts and estates and a general litigation practice. I believe that the most important part of representation is trying to leave you better off when the case is finished than when you started. Although I will do as my client directs, I will always tell you if I think that you are making a mistake. Bankruptcy is about a "fresh start". If you do not make changes in what you are doing, you will be doing what you are doing now in the future. There is no shame in bankruptcy or other steps that you may take to start your life over. Too often, people worry more about things than about themselves, their family or their future.
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