What is a Chapter 13 Plan?

Posted on Oct 04, 2013 By Mary Conner Pool

Mary PoolThe chapter 13 plan is a document prepared by your attorney and filed with the court that outlines how you will repay your debts over the life of your plan.  In other words, it is a repayment plan.  The chapter 13 plan directs the trustee on how your chapter 13 payments are to be disbursed to the creditors each month and how long you will be in the plan.  A chapter 13 plan may look different from one district to another but the essential premise of the document is the same.

Information in Your Chapter 13 Plan

Your plan will at the very least reflect the following:

  1. The amount of your chapter 13 payment and the frequency of how you will pay them (i.e., monthly, biweekly, etc.)
  2. The length of time of your plan (anywhere between 36 to 60 months)  NOTE:  Whether you can have a plan shorter than 60 months will be determined by your household income and/or how much you are paying back to your unsecured creditors.
  3. The amount of administrative fees to be paid (i.e., remaining filing fees, attorney fees)
  4. How the following debts will be paid in your plan:
  • 100% of priority debts will be paid through the plan (i.e., alimony, child support, and some taxes)
  • How secured debts will be paid through the plan (i.e., automobiles and furniture)
  • How much mortgage arrears will be paid through the plan (if you are keeping your home)
  • What property, if any, you plan on surrendering back to a creditor
  • What executory contracts will be assumed or rejected (i.e., lease, cell phone)
  • What payments your intend to pay directly or that will survive your bankruptcy (i.e., student loans)
  • How much, if any, you will be paying to your unsecured creditors

How to Prepare a Chapter 13 Plan

When you file your case, your Bond & Botes attorney will assist you in developing a plan that will work for you.  As your case progresses, your Bond & Botes attorney will keep you informed of any changes that may need to be made to your plan after you file your case.  The ultimate goal is to have your chapter 13 plan “confirmed” or approved by the court so that you may continue to make your chapter 13 payments and be protected from your creditors.

When Will My Chapter 13 be Filed?

Your chapter 13 plan must be filed within 15 days of your case being filed but at a Bond & Botes office it will usually be filed on the same day as when your case is filed.  As proof of claims come into your case, your chapter 13 plan may have to be amended to address any debts you forgot to list or correct the amount of debt listed if there is a significant change but your Bond & Botes attorney will always keep you informed of any necessary changes.

If you are overwhelmed by debt and want to have a repayment plan developed for you, give your local Bond & Botes office a call today to scheduled your free consultation.