Chapter 13 Question
If a debt beomes part of a Chapter 13 BK, is the payback based solely on principal with interest eliminated? For example, if some files Chapter 13 and opts for a 100% payback, 60-month plan, would a $60,000 CC balance be paid off at a rate of $1000 per month for 60 months? As another example, if someone had an "upside down" car loan in which $20,000 was owed on a car worth $15,000, would the filer only have to pay at a rate of $250/month (15,000 / 60)? If this is the case, it would seem that someone stuck with a high interest, long term, upside down car loan could get a dandy "refinance" by filing a Chapter 13!
The answer is, "it depends." It depends on which state you're in, the details of your finances, the type of debt you're paying back, the Proofs of Claim filed, and a number of other factors. Speak with your bankruptcy attorney for more detail.
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