Debt Reorganization and Repayment
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Post Chapter 13 Debt Organization and Repayment
The main aspect of your Chapter 13 bankruptcy case is your new debt repayment plan that will be proposed to both your creditors and the court. This plan must include all your debts and can be made with our assistance. Even if you carefully consider your plan, the creditors will have the ability to object. However, if you can make a plan to everyone’s satisfaction, it will likely be approved. Payments begin the month following your filing.
You will need to repay the following if you choose Chapter 13 bankruptcy:
- Priority debt — Priority debts include child support, tax obligations, and alimony arrearages.
- Secured debt — You can usually keep your car or house, but you will need to keep paying on your car loan or mortgage. The court decides whether these amounts will be included as part of your plan or not.
- Unsecured debt — This plan applies your disposable income and allowed living expenses toward debts such as credit card balances or medical bills. In some cases, you will not need to fully repay these debts or even pay them at all, assuming that you can show you are putting the remaining income toward their payment.
- Value of nonexempt property — If you can afford to do so, you are allowed to keep all your property in a Chapter 13 bankruptcy.