Filing for Chapter 13 bankruptcy can be confusing, especially regarding payment plans. How much will you have to pay each month? How is the plan calculated? Below, the team at Licata Bankruptcy Firm answers these questions and more.
If you are considering filing for bankruptcy, it is important to understand the payment plan process. The experienced bankruptcy attorneys at Licata Bankruptcy Firm can help make sure you get the best possible payment plan for your situation.
Chapter 13 Payment Plan
When you file for Chapter 13 bankruptcy, you propose a repayment plan to the court. This plan will last three to five years and include your disposable income. Your disposable income is the money you have left after paying for your basic living expenses. The court will look at your current financial situation and decide how much you can pay each month.
One of the primary factors that the court will look at is your income. They will want to see that you have a steady income and can make monthly payments. The court will also look at your debts, including any secured debts like your mortgage or car loan. The purpose of the Chapter 13 repayment plan is to pay off your debts over time, so the court will want to see that you are progressing.
Another factor that the court will consider is your assets. If you have a significant amount of equity in your home or other property, the court may require you to use some of that equity to pay off your debts. The court will also look at your expenses to ensure you are not using all of your income to pay for non-essential items.
Once the court has looked at all of these factors, it will develop a repayment plan that they believe is fair and realistic. This plan will be based on your current financial situation and different for each person. If you are having trouble making your payments, you may be able to modify the plan.
Licata Bankruptcy Firm is Here For You
Bankruptcy is difficult, but it doesn't have to be overwhelming. Understanding the Chapter 13 payment plan is a critical part of the process. The experienced bankruptcy attorneys at Licata Bankruptcy Firm can help you understand your options and ensure that you get the best possible outcome for your situation. Contact us today to learn more about how we can help you. (417) 213-5006