The amount that is repaid in a Chapter 13 bankruptcy case is not often determinable at the outset states Morris bankruptcy attorney. For this reason, it is difficult to calculate when clients ask, “What percentage am I going to pay back?” is that we really don’t know yet who is going to file a proof of claim. Let me give you an example. If you have ten credit cards at $10,000.00 each, that would be $100,000.00 worth of debt to repay. If five of those credit card companies do not file what’s known as a proof of claim and you finish your bankruptcy Chapter 13 case, then those five credit card companies’ debts are eliminated in full.
So if the remaining five credit card companies actually do file a proof of claim bankruptcy and get paid in full, you’ve technically paid 100 percent back on your creditors who actually filed claims. This would technically be 100-percent payback, although in reality 50 percent of your credit card debt did not even file a claim and got paid nothing. So don’t be fooled by what percentage back some people claim or some lawyers claim that you’re going to pay back. The truth is at the time the case is filed, we really don’t know how much you’re going to be paying back to unsecured creditors. All we can do is propose a payment plan and list your creditors and try and get the case confirmed. We then have to wait to see who files a proof of claim to determine whether or not you’re going to be paying back 10 percent or 100 percent or some number in between.
If you’re going to file a Chapter 13 bankruptcy case, make certain that you have competent, skilled, experienced Chapter 13 bankruptcy lawyer working on your case. A skilled attorney can help you pay back as little as possible under the bankruptcy code. The Chapter 13 trustee may demand that you pay more. However, your bankruptcy attorney will be able to take the issue before the court for a hearing. Often times, the trustee will be correct or the judge will simply rule in the trustee’s favor. In other situations, the trustee is being unreasonable and the judge will side with the debtor and the debtor’s attorney. By having strong counsel working on your behalf, you can rest assure that the process is not going to get out of hand. Your Chicago bankruptcy attorney will make certain that you have your day in court.