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How much will I have to pay in a chapter 13 bankruptcy?

Many people in Washington, D.C., opt to file for a chapter 13 bankruptcy because it enables you to develop a play to pay off your debts. Before filing, you may be concerned about just how much your payments will have to be. Each chapter 13 filing will look different, because it takes into account your income, the length of your payment plan and the value of your assets.

The U.S. Courts notes that this plan must be for five years if your monthly income exceeds the state median. If your income is less than the state median, your repayment plan may only last for a period of three years. You will be charged a case filing fee and an administrative fee, each of which you will have to pay in full, though you may make those payments in installments.

When it comes reorganizing your debt, the claims will be sorted into three categories: priority, secured and unsecured. A secured claim is one in which the creditor could take back your property if you do not make payments. Unsecured claims are those in which the creditor does not have a right to any property. Priority claims are those that include child support, alimony payments and most tax debts.

Typically, a chapter 13 filing will hold you accountable for paying the following: 

  •        Priority debts: You will have to pay 100 percent of the amount you owe.
  •        Secured debts: You will either have to pay the amount of the value of the property or the total amount of the debt, depending on the circumstances.
  •        Unsecured debts: These do not need to be paid in full, though the payments must be as much as creditors would receive through a chapter 7 liquidation.

These are general guidelines, and your case could look different depending on the circumstances. While this information may be useful, it should not be taken as legal advice.

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