About the Chapter 13 Bankruptcy Calculator
Chapter 13 bankruptcy, sometimes called a wage earner's plan, lets people with regular income reorganise their debts. Instead of selling assets, as in Chapter 7, the debtor proposes a repayment plan lasting three or five years, makes monthly payments to a court-appointed trustee, and receives a discharge of most remaining unsecured debt at the end. It is often used to save a home from foreclosure, catch up on a car loan or protect property that would be lost in Chapter 7.
This Chapter 13 bankruptcy calculator gives a rough estimate of the monthly plan payment. It compares your disposable income with the minimum needed to pay priority debts, secured arrears and the value of non-exempt assets, adds the trustee's fee, and shows how much unsecured creditors might receive over the plan.
How to Use the Chapter 13 Bankruptcy Calculator
Enter your monthly income and allowed monthly expenses.
Choose the plan length, 36 or 60 months.
Enter priority debts, secured arrears, the non-exempt asset value, unsecured debt and the trustee fee.
The Formulas
disposable income = income − allowed expenses
minimum payment = (priority + arrears + non-exempt assets)
÷ (months × (1 − trustee fee))
plan payment = the larger of the two
to unsecured = payments − trustee fee − priority − arrearsStep-by-Step Example
5,000 income, 4,300 expenses, 60 months, 6,000 priority, 9,000 arrears, 40,000 unsecured, 10% fee.
disposable 5,000 − 4,300 = 700
minimum 15,000 ÷ (60 × 0.9) = 277.78
payment 700 a month
total 700 × 60 = 42,000
trustee 42,000 × 10% = 4,200
unsecured 42,000 − 4,200 − 15,000 = 22,800, 57% of 40,000What the Plan Must Pay
A Chapter 13 plan must meet several tests. Priority debts, such as recent income taxes and domestic support arrears, must be paid in full. Secured arrears, the missed payments on a mortgage or car loan you want to keep, are paid off through the plan while you keep making regular payments. The best interests test requires unsecured creditors to receive at least what they would get if your non-exempt assets were sold in Chapter 7. And the disposable income test requires you to commit all your projected disposable income for the plan period.
The Means Test and Plan Length
The means test compares your income with the median income for a household of your size in your state. If your income is below the median, you may propose a three-year plan; if above, the plan usually lasts five years, and allowed expenses are set by IRS standards rather than your actual spending. This calculator lets you enter allowed expenses directly, but the official calculation is detailed and is best done by an attorney.
The Trustee's Fee
The Chapter 13 trustee administers the plan, collecting payments and distributing them to creditors. The trustee's fee is a percentage of the payments, set by the court and capped at 10%. The calculator adds it so the payment covers both creditors and the fee.
Unsecured Creditors
Credit card debt, medical bills and personal loans are usually unsecured. They are paid whatever is left after the fee, priority debts and arrears. Some plans pay unsecured creditors in full; many pay a fraction, sometimes very little. Whatever remains unpaid is generally discharged when the plan is completed.
After the Plan
Completing a Chapter 13 plan leads to a discharge of most remaining debts, though some, such as most student loans and support obligations, survive. If payments are missed, the case may be dismissed, leaving the debts in place, or converted to Chapter 7. Plans can sometimes be modified if income falls.
Chapter 13 and Your Home
One of the main reasons people choose Chapter 13 is to stop a foreclosure. Filing triggers an automatic stay that halts collection, and the plan lets you pay the missed mortgage payments over three to five years while keeping up with regular payments. If the home has more equity than your state's exemption protects, the plan must pay unsecured creditors at least that non-exempt amount, which the calculator includes.
Car Loans and Cramdown
In some cases, a car loan taken out more than about two and a half years before filing can be reduced to the car's value, with the rest treated as unsecured debt, a process called cramdown. The interest rate may also be adjusted. These rules are technical; an attorney can tell you whether they apply.
Credit Impact
A Chapter 13 filing stays on a credit report for up to seven years from the filing date. Many people find that their credit begins to recover during the plan, because their debts are being managed and new late payments stop. Getting new credit during the plan usually needs the trustee's or court's permission.
Costs of Filing
Besides the plan payments, Chapter 13 involves a court filing fee and attorney fees, which are often partly paid through the plan itself.
Understanding Your Result
The headline gives the estimated monthly plan payment.
The why line explains whether disposable income or the minimum set the payment.
The totals line shows the total paid, the trustee's fee and priority amounts.
The unsecured creditors line shows what they may receive.
When Should You Use This Calculator?
Use it to understand roughly what a Chapter 13 plan might cost.
Use it before meeting a bankruptcy attorney.
Use it to compare Chapter 13 with other debt options.
Common Mistakes
Using actual instead of allowed expenses. The means test limits them.
Forgetting the trustee fee. It adds up to 10%.
Ignoring arrears. Catching up on secured debt is part of the plan.
Filing without advice. Bankruptcy has lasting consequences.