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Chapter 13 Bankruptcy Plan

A chapter 13 bankruptcy plan is a schedule of payments you are to make to the trustee of the court who has been appointed to your bankruptcy claim. The trustee will review your monthly income and expenditures, and based on that, she or he will create a plan of repayment that you are required to comply with. Of course, the plan needs to be approved by the courts before it is considered binding, but once it is, both you and your creditors are bound by it. If you don't make your payments as reflected in the chapter 13 bankruptcy plan you face the possibility of having your entire bankruptcy claim dismissed. And, even though there is a stay issued to all your creditors, you are still required to keep up with any payments that are due during the bankruptcy period.

Fast Facts

  • A chapter 13 bankruptcy plan period shall not be longer five years.
  • Plan payments are made to the trustee, and the trustee pays the creditor.

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