Unfortunately, the answer is not the same for everybody, as each payment plan is determined by the individual filer's situation. It can depend on several factors, and each has to be looked at in turn. These include:

  • How much disposable income (DI) you have available for payments. Simply put, it is how much money is left over from your net monthly income after all regular monthly expenses are paid.

  • What means testing says you have to pay. Means testing calculations can show a mandatory minimum payment to your creditors over a five year plan.

  • How much money you need pay through your plan. There are certain debts that must be paid in full for practical or legal reasons, and they can include arrears on a mortgage to save a home, arrears on alimony, child support or other domestic support obligations, or taxes.

  • How much you have in unexempt assets. The bankruptcy code can create a "floor" or minimum amount that must be paid to creditors based on the "unexempt value of assets." The law provides protection for your assets in a bankruptcy through "exemptions." However, not all of these are unlimited.

Determining your plan payment can be involved. If you are thinking about filing a chapter 13 bankruptcy in New Jersey and are concerned about whether you could afford the plan payments, call my office at 856-432-4113 orcontact me through this site for a free consultation.

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Steven J. Richardson
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Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.