When you file a Chapter 13 bankruptcy, you are required to file a plan of reorganization which outlines how you intend to pay your creditors. The court must approve the plan, which means that it is “feasible” or that you have sufficient income to meet the financial obligations of the plan.
Creditors can file Proofs of Claim with the court. The Proof of Claim sets forth how much the creditor is owed and provides information regarding any assets pledged as collateral under the loan. The Chapter 13 trustee reviews the claims filed to determine the amount of money that will be required to be paid by the debtor to successfully fulfill the terms of the plan. All claims of creditors are paid according to their priority. For more information on how the priority of claims are determined, please read our blog titled “Understanding Secured and Unsecured Debt.”
The plan “base” is the total amount to be paid under your plan over a period of three years. For example, if you pay $100 per month over 3 years, your base is $3600. Your plan is only feasible if the base amount exceeds the total amount of your creditor’s claims that are required to be paid. If your plan is not feasible, you can amend your plan to achieve feasibility. The most common ways to amend a plan are to extend the length of the plan up to a maximum of 5 years, or to increase the amount of your monthly plan payment.
We can assist you with creating a manageable and feasible Chapter 13 plan.
Contact The “Milwaukee Bankruptcy Attorneys,” DeLadurantey Law Office. LLC for all your Chapter 7 and Chapter 13 bankruptcy needs. Whether you need debt negotiations or debt relief, or even foreclosure defense, DeLadurantey Law Office will handles bankruptcy matters for the following location – Milwaukee, South Milwaukee, West Milwaukee, Waukesha City, Waukesha Town, Kenosha, Racine, and all other municipalities in Milwaukee County, Waukesha County, Kenosha County, and Racine County. DeLadurantey Law Office, LLC can be contacted by phone at (414) 377-0518.