What is the Chapter 13 Plan?

The Chapter 13 Plan is a repayment plan, typically spread out over three to five years.

The Chapter 13 Plan must:

  • provide for payments of fixed amounts to the trustee on a regular basis, typically monthly
  • provide for the full payment of all claims entitled to priority under section 507 such as taxes and child support (unless the holder of a particular claim agrees to different treatment of a claim)
  • provide for equal monthly payments to secured creditors to be paid through the Chapter 13 plan
  • if the plan classifies claims,  provide for the same treatment for each claim within each class.

After the Meeting of Creditors has taken place, the Court will hold a hearing to determine whether the plan filed with the court is feasible, complies with all requirements, and is otherwise confirmable.  This hearing is referred to as the Confirmation Hearing.  Creditors receive notice of the hearing and may object to the confirmation of the plan.

The debtor must commence making payments to the Chapter 13 trustee during the first full month following the filing of the case.  Once the plan is confirmed by the court, the trustee will distribute the funds to creditors according to the terms of the plan.