Plan Payment Information

Payments
Payroll Deduction Orders
Obligation to Pay
Failure to Pay
Adjustments of Payments


Payments:

 
Whenever possible Chapter 13 payments are made through a payroll deduction at your place of employment.  It will be easier to remain current on your payments to the Trustee if the payment is automatically made on a regular basis by your employer.  Only in unusual circumstances does the Court allow plan payments to be made by you directly to the Trustee.  MONEY ORDERS, CASHIER'S CHECKS AND PAYMENTS MADE BY PERSONAL CHECK MUST INCLUDE: (1) your NAME, (2) your ADDRESS, and (3) your CHAPTER 13 CASE NUMBER.  DO NOT MAIL CASH OR BRING PAYMENTS DIRECTLY TO THE TRUSTEE'S OFFICE.  If your personal check is ever returned to us for insufficient funds, or "bounces," we will require that all future payments into your plan be made in the form of a cashier's check or money order.  Please make all checks payable to Joyce Bradley Babin, Trustee, and forward all payments to:

Joyce Bradley Babin, Trustee
P.O. Box 55161
Little Rock, AR 72215-5161

DON'T FORGET YOUR CASE NUMBER!!!
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Payroll Deduction Orders:

At the time you filed your Chapter 13 petition, the Judge may have issued an order to your employer to deduct your plan payment from your paycheck and send it to the Chapter 13 Trustee.  While you are under the protection of Chapter 13, this order PROHIBITS your employer from honoring any garnishments, including back taxes, except on-going child support, or as otherwise provided in the order.  It is important that both you and your employer understand that such an order is NOT A GARNISHMENT.


A garnishment or attachment can come only from someone to whom you owe money, and you do not owe the Court or the Trustee any money.  The Court is just carrying out its duty to administer the plan you voluntarily filed and in which you gave the Court exclusive jurisdiction over your future pay as long as you are in a Chapter 13 plan.  Most employers understand that you are making a serious effort to repay your debts rather than avoid them.  If your employer does not honor a wage deduction order, let your attorney and the Trustee's office know immediately so that the appropriate action may be taken.  If your employer has any questions, he or she may call or office for an explanation.

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Obligation to Pay:

Even though the Court will usually order your employer to deduct plan payments and send them to the Trustee, you must remember that you have the obligation to make sure payments are made.  You will receive a copy of the order requiring payments soon after the plan has been filed.  Regardless of when it is received, the law requires that payments be commenced within 30 days after the plan is filed.  


Note:  It may take several weeks for your payroll deduction to become effective.  In the meantime, be sure to make your regular payments directly to the Trustee.  The Judge's willingness to approve your plan will depend on the good faith effort you demonstrate by your payment record prior to the confirmation hearing.  If your employer ever fails to make a payroll deduction, you must tell your attorney that the deduction was not made and you must send the needed plan payment to the Trustee by personal check, money order, postal order or cashier's check. 
It is a good idea to keep your pay stubs to demonstrate that the deductions are taking place.  If there is ever any discrepancy in your payment history, you will have the complete records demonstrating all the deductions that were made.  PLEASE REMEMBER:  If you ever receive a regular paycheck in which the Trustee payment was not withheld, you should immediately mail the payment yourself.

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Failure to Pay:

 If the Trustee's office fails to receive payments on your Chapter 13 plan, the Trustee or a creditor will seek to have your case dismissed.  If something happens to your job, you become disabled, get laid off or get a better job, consult with your attorney at once.  Your attorney may be able to counsel you on the best way to protect yourself during such time.  The Trustee will send you notices or letters and you will be advised, in writing, when the Trustee seeks to have your case dismissed.  In the role of administrator of Chapter 13 cases, the Trustee bears the dual responsibility of looking out for the interests of both debtors and creditors alike.  Thus, whenever a debtor is substantially delinquent in payments under the plan, the Trustee will review the case for dismissal.

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Adjustment of Payments:

It is extremely important for you to let us know if something interrupts your pay and makes it impossible for you to make payments to the Trustee.  In some cases, depending on how long your plan has been going and the kinds of creditors you have, adjustments may be made on payments to prevent undue hardship.  Do not confuse this type of adjustment with an emergency.  If the payment adjustment required is more than just a temporary adjustment, please contact your attorney to review and revise your plan.

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