Completing a Chapter 13 Bankruptcy
On average, a
Chapter 13 bankruptcy
repayment plan can last anywhere from
three to five years
. Yet, there are factors to consider in determining how long your case
will last since each situation varies. The amount you pay is based on
your monthly income, with similar factors determining the amount of time
the debtor commits toward making payments. This is known as the commitment
period or plan duration. Income qualifications for Chapter 13 are based
on state requirements.
Chapter 13 bankruptcy is a repayment plan approved by the court. The plan
is designed to help debtors make regular payments toward debt obligations
while regaining control of their financial situation. The amount you earn
can affect the duration of your plan. Paying off debts early can also
reduce the commitment period. Five years is the maximum amount of time
a Chapter 13 plan lasts.
The type of debt included in your plan may also affect the length of your
case. Most people make payments within the 3 to 5 year range. Some may
complete the plan within 3 years depending on their situation. For instance,
Chapter 13 is filed to help catch up on mortgage and vehicle payments.
If your filing is being used to cure a default, the length of your filing
may be longer if your payments are smaller to help you retain property
(house or vehicle).
Another factor that can affect the length of your case is if your circumstances
change such as long-term or short-term financial problems. This may be
a job loss, changes in earned income or other financial hardship. When
such changes occur you should report them to your attorney or trustee
as soon as possible to consider other arrangements to keep your case in
Have Any Questions About Chapter 13 Bankruptcy?
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