P. 3015
Following the meeting from creditors, the brand new borrower, the fresh chapter 13 trustee, and the ones loan providers who wish to sit-in may come so you can courtroom getting a hearing on the debtor’s part thirteen payment package.
Unless of course brand new judge grants an extension, the latest debtor need to document a fees plan on petition otherwise inside 14 days following petition is actually filed. Fed. R. Bankr. A strategy have to be registered for courtroom recognition and must bring getting payments of repaired number to the trustee for the a frequent basis, usually biweekly or month-to-month. This new trustee following directs the income so you can financial institutions with regards to the regards to the master plan, which could promote creditors less than complete fee on the states.
You will find around three sort of claims: consideration, shielded, and you may unsecured. Priority claims are those supplied unique standing by the bankruptcy law, particularly most fees and also the will set you back from bankruptcy proceeding. (3) Safeguarded says are the ones for which the newest collector contains the correct restore certain property (i.age., this new collateral) in case the debtor cannot spend the money for underlying loans. Compared to protected claims, unsecured says are usually the individuals which new collector has no unique rights to gather against style of property owned by the fresh borrower.
S.C
The plan must pay consideration claims in full until a particular concern collector agrees to several treatment of the brand new allege or, regarding a residential help obligations, unless the newest debtor contributes every “throwaway money” – chatted about lower than – in order to a five-seasons bundle.eleven U. § 1322(a).
Should your borrower wants to support the collateral securing a certain allege, the program ought to provide that the proprietor of your shielded allege discover at least the worth of the new collateral. When your obligation underlying the fresh new safeguarded claim was used to invest in loans Sulligent AL brand new equity (age.grams., a car loan), together with obligations try sustained contained in this particular big date frames through to the bankruptcy proceeding processing, the plan must provide to have complete fee of one’s obligations, just the worth of the fresh guarantee (that is certainly shorter because of depreciation). Money to certain safeguarded financial institutions (we.age., your house mortgage lender), can be made-over the original mortgage cost schedule (which may be more than the plan) as long as one arrearage consists when you look at the plan. New borrower should consult a legal professional to select the proper treatment from secure states in the plan.
The plan need not shell out unsecured claims in full as long it includes that debtor will pay all of the estimated “throw away earnings” more than an enthusiastic “relevant union period,” so when much time since unsecured financial institutions located at the very least normally according to the plan because they would receive in the event your debtor’s assets have been liquidated less than chapter 7. 11 U. § 1325. In part thirteen, “disposable money” was income (except that youngster help repayments received by borrower) reduced numbers fairly necessary for the maintenance otherwise help of one’s borrower otherwise dependents and less charity efforts to fifteen% of your debtor’s gross income. If for example the debtor works a corporate, the expression throw away income excludes the individuals amounts being called for to own typical doing work expenses. eleven U. § 1325(b)(2)(A) and you can (B). This new “applicable connection several months” relies on the new debtor’s most recent month-to-month money. The appropriate connection several months must be 3 years in the event that newest monthly earnings is actually less than the state average for a household out of the same proportions – and you will five years in case the current monthly earnings was greater than a family of the same dimensions. eleven You. § 1325(d). The plan can be lower than this new relevant partnership several months (around three otherwise 5 years) only when personal debt are paid-in full more than a shorter months.