Chapter 13 cases get dismissed for a short list of reasons: plan payments stop, the mortgage payment stops, tax returns don't get filed, documents the trustee asked for never arrive, or the plan was built on a budget that never worked. Creditors rarely cause a dismissal. The debtor's own silence does. Most of these are fixable if someone calls before the hearing.
The numbers nobody quotes on a website
Nationally, something like half of Chapter 13 cases never reach discharge. The Central District, the busiest bankruptcy court in the country, is no exception. Some of that is bad plans filed by volume shops. Some is life. But the pattern in the cases that fail is consistent enough to name: the payment stopped, nobody told the lawyer, the trustee's motion to dismiss was mailed, nobody responded, and the case was gone.
Our completion rate is higher than that, and the reason isn't cleverness. It's that a plan built on a real budget and a client who calls when something changes is a plan that finishes.
Reason one: missed plan payments
The trustee's software flags a missed payment automatically. After the second or third, a motion to dismiss is filed with a hearing date about a month out. The motion will state the exact arrearage. If the money is paid before the hearing, the motion is usually withdrawn. If it can't be, we ask the court for a modification or a short moratorium, and the trustee's office often agrees to a stipulated cure over three to six months as long as it's the first default.
A second default under a stipulation is different. Most stipulations say the trustee can dismiss on declaration, without another hearing. That's the point of no return in most of the cases we've seen end.
Reason two: the mortgage
The plan is curing $27,000 of arrears and you've stopped paying the regular mortgage. The lender doesn't move to dismiss; it moves for relief from the automatic stay so it can foreclose. Once the stay is lifted, the point of the plan is usually gone, and either you convert, dismiss, or keep paying unsecured creditors on a plan that no longer saves the house. Post-petition mortgage defaults are the second most common way a Central District Chapter 13 ends, and the one that's hardest to recover from because the lender has already had two shots.
Reasons three and four: returns and documents
Unfiled tax returns kill cases early. If the last four years aren't filed by the day before the first 341 meeting, the trustee continues the meeting, and after a couple of continuances moves to dismiss. During the plan, each year's return has to be provided to the trustee. Silence gets treated as default.
The document requests are simpler and still fatal. The trustee asks for two months of bank statements and a pay stub before confirmation. If they don't arrive, confirmation is denied and the case dismissed. We send a checklist before filing and chase it. The Chapter 13 overview lists what the trustee expects in the first 60 days.
Reason five: the plan was never going to work
Some plans fail at confirmation because the budget had $200 of groceries for a family of five and a plan payment that used every remaining dollar. Others get confirmed on those numbers and fail in month four. Either way the problem was the drafting, and the cheap fee that paid for it. Our first job is to say no to a plan that can't be paid, even when the client wants it badly because it's the only way to keep the house. That's roughly one call in seven for us across both chapters.
What dismissal costs you
The automatic stay ends the day the dismissal order is entered. The foreclosure resumes from where it paused. Interest and late fees that were frozen come back onto the balances as if the case never existed. The unsecured creditors who were getting 10% are owed 100% again. Any lien we stripped is restored. The attorney fee paid through the plan is paid to the extent the trustee disbursed it, and the rest is owed.
If you refile within a year, the automatic stay in the new case lasts only 30 days unless we file a motion to extend it and show the new case was filed in good faith. Two dismissals within a year, and there's no stay at all without a motion. Judges in Los Angeles grant those motions when the second case has a real change behind it, such as a new job, and deny them when it looks like a strategy to delay a sale.
Keeping the case alive
The checklist is short.
- Pay the plan by wage order if your employer allows it
- Keep paying the mortgage directly and keep the confirmations
- File every tax return on time and send the trustee a copy
- Call the office the week something changes, not the month after
- Open every envelope from the trustee or the court and forward it
A case that's already in trouble can usually be saved before the hearing date and sometimes at it. Book a video consultation or call (310) 555-0184 with the motion in hand.
the envelope from the trustee's office is the one people leave on the counter unopened, because they already know what it says. I understand it. I also know that the case is almost always salvageable on the day the envelope arrives and almost never on the day after the hearing. If you're in a plan with us and something has gone wrong, I'd rather hear the bad news on a Tuesday afternoon than read about it in a motion. Nobody has ever been lectured for calling too early.
Questions people ask about this
How many missed payments before a Chapter 13 is dismissed?
Usually two or three before the trustee files a motion, then about a month until the hearing. That's the window to cure or modify. Some trustees move faster in the months right after confirmation, when a default suggests the plan never fit.
Can I refile Chapter 13 after a dismissal?
Yes, unless the case was dismissed for willfully disobeying a court order or you voluntarily dismissed after a stay-relief motion, which brings a 180-day bar. In a refiled case within a year, the automatic stay lasts 30 days unless the court extends it on motion.
Does a dismissed Chapter 13 count as a bankruptcy on my credit report?
The filing is reported whether or not it ended in discharge, for up to seven years from the filing date. A dismissal doesn't remove it. The report will show the case was dismissed rather than discharged.
Can a creditor get my case dismissed?
A creditor can move to dismiss for cause, such as bad faith, and the trustee can move for the reasons on this page. In practice, creditor-driven dismissals are rare in consumer cases. The overwhelming majority come from the trustee's office on nonpayment or missing paperwork.
What happens to the money I paid into the plan if it's dismissed?
Money already disbursed to creditors stays with them. Funds the trustee is holding are refunded to you after approved administrative fees. Payments made toward mortgage arrears count against the arrears, so the lender's balance is lower than when you started, even if the cure wasn't finished.
Should I dismiss my own case if I can't afford the plan?
Not without talking to us first. Conversion to Chapter 7 or a hardship discharge may get you a discharge that a dismissal throws away. If a new Chapter 13 later is the goal, voluntary dismissal can be right, but the timing and the 180-day rule need to be checked.
Talk it through with the attorney
If you've received a motion to dismiss, or you can see one coming, call (310) 555-0184 today. Naomi will read the motion with you, tell you what the trustee will accept, and file whatever keeps the case on the calendar.