If you are in a chapter 13 bankruptcy case and you have a pending Motion (either Motion for Relief or Motion to Dismiss), you may have heard the terms cure order. Keep reading to find out more about the cure order and the impact it has on your case.
Let’s start with what a Motion for Relief from Stay is. This is where most commonly a creditor files a motion to take certain property out of the protections from the bankruptcy automatic stay. Usually this is seen with secured items, but it can also be in regards to leases. Typically this will come about if you either fall behind paying your debts post-petition or if you are surrendering items in the chapter 13.
Similarly, the trustee may file a Motion to Dismiss, if you fall behind on your chapter 13 plan payments.
A cure order is an order with the other party bringing the motion, to catch up your payments and avoid the Motion being granted. Usually this is over a set amount of time, typically about six months. There are terms in the cure order for how much you will pay each month, when the payments start and end, and what happens in the event you default on the payments. Cure orders tend to have strict language in them regarding default triggers and ex parte relief. Be sure to speak in depth with your attorney regarding pros and cons of the cure orders if you are interested.
Cure orders are typically very common in chapter 13 cases as they help bankruptcy debtor’s catch up on payments they have otherwise fallen behind on.
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