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 a different treatment of the claim)
• provide for equal monthly payments to secured creditors, such as mortgage companies and car lenders, to be paid through the Chapter13 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.

Starting with the first full month after you file your Chapter13 case, you must begin making  payments to the trustee.  Once your plan is confirmed by the court, the trustee will distribute the funds to creditors according to the terms of the plan.