According to Gurnee bankruptcy attorney, any debt can be paid back in a Chapter 13. This includes secured debt such as mortgage arrearages and vehicle payments as well as unsecured debts such as student loans, recent taxes, parking tickets, child support, alimony and debts incurred via fraud. The trick with a Chapter 13 is that you must be paying back either all or a portion of your debt over the life of the Chapter 13 case. The creditors are paid back pursuant to the plan that you file with the court as well as a hierarchy that is set out in the Bankruptcy Code.
Child support is a priority under the bankruptcy code and domestic support obligations such as child support will be paid back first. The next priority to repay debt under Chapter 13 would be secured debt such as mortgage arrearages and vehicle payments. The last and least important of the creditors that are paid back through a Chapter 13 are the unsecured creditors. General unsecured creditors can be paid back anywhere from 10% to 100% over the life of the case which is approximately 3 to 5 years. The amount that you pay per month and the percentage that you pay is dictated by your income, your expenses, your assets, your liabilities and your total debt.
Your Chapter 13 bankruptcy attorney will help you prepare a plan that will be submitted to the court. Once the trustee is satisfied that you are complying with the terms of the Bankruptcy Code, the trustee will recommend that your case be confirmed. Once your case is confirmed, your Chapter 13 plan is solid and provided you continue to make your plan payments, you will not have a problem. If you do have a problem making your plan payments, the trustee will likely bring a Trustee’s Motion to Dismiss. A Trustee’s Motion to Dismiss is a motion brought before the court whereby the trustee is claiming that you are not complying with the terms of the Bankruptcy Code and not complying with the terms of your confirmed plan and thus your case must be dismissed. If you are making all of your planned payments on time and your case is confirmed, you will have success under your Chapter 13 repayment plan.