Expert: Terry Leeders - 4/7/2008

Question
I filed a Chapter 7 back in 2003 and due to unemployment I am in need to file a chapter 13. However, I have been told different things about the arrears I owe in Child Support. I owe around $80,000 (most being penalty and interest). I have a court ordered child support attached to my paycheck. Can I still file Chapter 13 with this amount owed? I thought I could still file with them still taking amounts out of my check and it being separate from the Chapter 13?

Answer
Good question.  In Chicago, one of the bankruptcy judges just ruled on this issue, and ruled that Child Support arrears must be paid in full through the chapter 13.  If your jurisdiction has similar case law, your payment will be quite high, since you will have to cure it through the ch13.