In this article, we provide the Chapter 13 Bankruptcy Plan Payment Calculator. We also provide pros and cons to your debt relief options along with analysis to help you make the most informed decision.
What is your estimated Chapter 13 Plan Payment? Check your precise estimate below.
When you experience a financial hardship that makes it unaffordable to continue to pay your debts at the current rates, there are three main options that many folks consider:
There are many options available to relieve your debt and achieve debt freedom, but the options above are often the most common when you are unable to afford your debt and the other options are not available or do not work for your situation.
In this article, we provide a Chapter 13 plan payment estimate along with a link to our more precise estimate using US bankruptcy forms, a brief overview of your options, and the pros and cons to those options. Our goal is that understanding your estimated plan payment and the pros and cons for each option will help you make the most informed decision for what's best for you.
Your bankruptcy attorney or you propose a repayment plan to pay back a portion or all of your debts over a three or five-year period based on numerous factors in a Chapter 13:
Because of the complexity of this calculator, the results of our calculator below can serve as merely an estimate of your minimum plan payment, but we hope that this will allow you to compare your payments in an unbiased way to your different options such as debt settlement or even debt management.
The Chapter 13 calculator rough estimate considers debts that you want to pay for property or things you want to keep and certain debts that you are legally obligated to pay. It also considers the trustee fees and certain legal fees.
The rough estimate computes the minimum Chapter 13 plan payment estimate. The output does not consider disposable income or non exempt assets or other pertinent pieces of financial information. Your plan payment may be significantly higher if you have disposable income or assets that are not considered in the rough estimate.
This can be a great 2 minute estimate of what your minimum plan payment may be, but it does not go into as great of detail as the precise estimate.
The rough Chapter 13 Calculator estimate considers the minimum plan payment that you would pay in a Chapter 13 payment plan. The precise estimate is a longer calculation that considers additional factors to calculate a more precise Chapter 13 payment plan estimate because not everyone is eligible to pay the minimum. It also allows you to compare your debt relief options.
What are reasons why your plan payment would be more than the minimum payment? Let’s go through two common reasons why your plan payment would be more costly than the the minimum payment.
The bankruptcy court wants you to pay back your creditors. When you say you are unable to do so, the court wants to ensure that you can only pay the minimum plan payment. The court has three forms that are common for Chapter 13 bankruptcies to determine whether you have disposable income to pay nonpriority unsecured creditors.
Most states have exemptions for what property or items are protected from a bankruptcy. What is important to note is that each state varies greatly from what is exempt and the amounts of the exemption. If your equity in an asset exceed the amount that state allows to exempt, you would be liable to pay for some amount in your plan payment.
The main difference between Chapter 7 and Chapter 13 bankruptcies is that all your debt is wiped out in Chapter 7 regardless of what you owe. For reference, student loans are generally not discharged in either type of bankruptcy. Experian provides an excellent Chapter 7 vs. Chapter 13 comparison, but I'd like to provide a summary of the differences between the two main bankruptcy types.
To qualify for Chapter 7, you must meet income guidelines based on means testing. This information is determined by the Census Bureau and the Internal Revenue Service. These income guidelines are based on the income based on your family size and the state where you reside. The most recent Census Bureau Median Family Income By Family Size for May 1, 2019 and beyond can be found here. If you earn more than the median, the next step would be to determine whether you have enough left over to repay some of your debt. We can do this calculation for you in under 5 minutes, so feel free to send us a note directly if you'd like us to run that calculation.
Chapter 13 is another way to get rid of your outstanding debt, but it takes much more time and is more involved. Since a Chapter 7 bankruptcy can be completed in under 1 year, a Chapter 13 bankruptcy can take up to five years. There are also limits as to how much debt you can include.
When you file a Chapter 13 bankruptcy, it can be similar to a structured settlement plan in a debt settlement in that you have to pay some or all of your debts. The amount that you pay typically depends on the type of debts included in the bankruptcy and how much you owe to your creditors. There is also a waterfall of payment priority with the first payments made to your lawyer(s) and the lowest priority to your unsecured creditors.
The benefit of a Chapter 13 bankruptcy is that you may get to keep some of your assets, as there are some protections by state.
It's helpful to compare your debt settlement vs bankruptcy plan payments because each are viable debt relief options. Below is a breakdown of the pros and cons of debt settlement vs bankruptcy with estimated positive or negative weighting for each of the different options.
We would love to run your Chapter 13 Calculation for you. All you need to provide is your email below if you’d like us to run through a Chapter 13 calculation for you and see whether Chapter 13 Bankruptcy is best for you.
There are many considerations to consider whether to pursue a Chapter 13 bankruptcy. Before you sign the dotted line, estimate your chapter 13 plan payment.