What Percentage Is Paid Back In A Chapter 13?

This video talks about the percentage that is paid back to creditors in a Chapter 13 bankruptcy case.  It will vary depending upon the assets, liabilities, income and expenses of a debtor.  Each case is particular to the facts of that case.

Jesse Barrientes: What kind of percentage do you pay back in a Chapter 13 consolidation?

David Siegel: It’s going to depend on a number of factors including your assets, your liabilities, your income, and your expenses. And whether or not you filed a Chapter 13 and got a discharge or a Chapter 7 in the last several years.

In most cases is going to be the difference between your income and your expenses which is known as your disposable income. So typically if you have a couple hundred dollars available, that’s what the creditors are going to get per month over 3 to 5 year period and whatever percentage that winds up being is what it is.

Jesse Barrientes: But you still have to have enough through that duration, the 36 or 60 months in order to pay your secured creditors 100% and your unsecured what, as little as $.10 on the dollar?

David Siegel: Right, but what I never want to do is I never want to quote a percentage because in reality, I don’t know who’s going to file a proof of claim and who’s going to be part of the bankruptcy case. If you are a client who completes the bankruptcy and a creditor, unsecured creditor did not file a proof of claim to be part of the payout, then that debt is eliminated in its entirety.

Jesse Barrientes: In a Chapter 13.

David Siegel: Right.