How Chapter 13 Repayment Works
In a Chapter 13 bankruptcy (reorganization), you keep your assets and repay creditors over 3 or 5 years based on your disposable income. Disposable income is what remains after subtracting IRS-allowed living expenses from your gross monthly income.
The plan duration depends on whether your income is above or below the state median. If your income is below the median, a 3-year plan is sufficient. If above, a 5-year plan is required. Secured debts like mortgages may require additional payments beyond this estimate.
This calculator provides a simplified estimate. Actual figures depend on your specific expenses, secured debts, trustee fees, and local court rules. Always consult a bankruptcy attorney for personalized advice.
Frequently Asked Questions
Missing payments can result in the trustee filing a motion to dismiss your case. If dismissed, your debts are no longer protected and creditors can resume collection. You may be able to catch up or modify the plan if you act quickly.
Not necessarily. Priority debts (taxes, child support) must be paid in full. Secured debts are paid to keep collateral. Unsecured debts (credit cards, medical bills) receive whatever is left—often cents on the dollar—and the remainder is discharged at plan completion.