P. 3015
After the meeting off creditors, the brand new borrower, the fresh chapter thirteen trustee, and people creditors who want to sit-in can come to legal to own a paying attention for the debtor’s part thirteen fees package.
Except if the brand new legal provides an expansion, new debtor must file a repayment package for the petition or contained in this two weeks after the petition is submitted. Given. R. Bankr. An agenda should be filed to have courtroom acceptance and should give to possess repayments away from repaired numbers for the trustee for the a frequent foundation, typically biweekly otherwise month-to-month. The trustee then distributes the cash to help you loan providers according to the terms of the program, which may give financial institutions lower than complete percentage on the says.
Discover about three particular states: top priority, protected, and you may unsecured. Top priority claims are those provided unique status by the case of bankruptcy rules, such as really taxation and will set you back of personal bankruptcy. (3) Safeguarded says are the ones which this new collector gets the best get back particular possessions (i.e., brand new equity) in case your borrower cannot pay the root personal debt. In contrast to safeguarded claims, unsecured states are often people in which the fresh collector has no special legal rights to get up against types of assets belonging to brand new debtor.
S.C
The master plan need to pay consideration says in full until a particular top priority creditor agrees to various remedy for the newest claim or, in the case of a domestic assistance duty, unless of course the brand new borrower adds all “throwaway earnings” – talked about lower than – in order to a great four-year package.11 You. § 1322(a).
In the event your borrower wants to support the guarantee protecting a specific claim, the plan should provide that manager of one’s covered allege located at the very least the worth of new guarantee. In case your duty fundamental new shielded claim was used to purchase the collateral (elizabeth.g., an auto loan), and the financial obligation try obtain in this certain date frames before bankruptcy submitting, the program ought to provide to own full fee of one’s personal debt, not just the value of the newest guarantee (which may be shorter due to decline). Repayments to specific official site covered loan providers (i.elizabeth., the house home loan company), may be made over the initial mortgage fees agenda (that can easily be longer than the program) for as long as people arrearage comprise when you look at the package. The debtor will be consult a lawyer to find the proper treatment away from secure states in the package.
The plan does not have to pay unsecured says in full provided that it gives that the borrower will pay every estimated “throwaway income” more than an “appropriate relationship months,” so that as a lot of time since unsecured loan providers receive no less than as much beneath the plan as they do discover if the debtor’s assets have been liquidated significantly less than chapter 7. eleven You. § 1325. When you look at the chapter 13, “throw away income” was money (aside from youngster support repayments gotten from the borrower) shorter amounts relatively necessary for the maintenance otherwise assistance of your own borrower otherwise dependents and less charitable benefits to fifteen% of your debtor’s gross income. Whether your debtor works a corporate, the word throwaway income excludes those individuals quantity which happen to be requisite to have ordinary working costs. 11 U. § 1325(b)(2)(A) and you can (B). The fresh new “relevant connection several months” depends on the debtor’s latest month-to-month income. New appropriate relationship months should be 3 years if current month-to-month income was below the official average for children out of a comparable proportions – and you can 5 years in case your newest month-to-month earnings is higher than children of the same size. eleven U. § 1325(d). The master plan could be less than this new applicable union months (about three otherwise five years) as long as personal debt is actually paid in full more than a shorter period.