Chapter 13 Average Monthly Payment
What is the average Chapter 13 monthly payment that most people face during their Chapter 13 case? Although an average amount can be estimated, different types of cases result in different ranges for calculating an average Chapter 13 monthly payment. The average payment for a Chapter 13 varies within these various case types.
The Overall Chapter 13 Average Payment
The average payment for a Chapter 13 case overall is probably about $500 to $600 per month. This information, however, may not be very helpful for your particular situation. It takes into account a large number of low payment amounts where low income debtors are paying very little back. Then it averages out the larger payments of $1000 to $2000 or more. These higher-payment-cases are usually due to higher income and housing repayment requirements. Cases in the $500 to $600 range are very common and reflect debtors who are usually paying at least one automobile through the plan and possibly some other “average-type” repayment requirements.
The Low-End Chapter 13 Payment “Average”
Cases within the $200-$300 per-month range (or less) are extremely common within the Chapter 13 system. These cases usually reflect medium to lower income debtors who need to only address some basic repayment requirements. Also, sometimes these lower-average cases are for situations where debtors are “forced” to file Chapter 13. In such cases, the debtor cannot file Chapter 7 because they are currently “barred” (unable to file Chapter 7 because 8 years has not yet passed from filing of a previous Chapter 7).
Paying House Payments and Arrears Cause the “Average” to Be Much Higher
If you are facing foreclosure or are behind in house payments, your Chapter 13 plan payment will be much higher. The “average” plan payment for such cases is usually closer to $1500 per month. Sometimes it can even be much greater. This is simply because the normal, ongoing mortgage payment along with the arrears must be fully paid throughout the life of the plan. In addition, the Trustee usually charges a “conduit” fee to pay the ongoing mortgage payment through the plan. The average plan payment is always higher in such cases.
High Income Bumps Up Your Average Payment
If you have high income, your “average” monthly Chapter 13 plan payment will likely be bumped up considerably. Depending on the range of your income, your payment could raise much higher. High income, high debt Chapter 13 filers very frequently face payments averaging in the $2000-$3000 range or even greater. On average, Chapter 13 will force such filers to repay a high percentage of the debt. Many times this will rise up to the 60%, 80%, or even 100% range of repayment. Still, these debtors will receive all the benefits of the Chapter 13 including 0% or dramatically reduced interest rates. They will also benefit from the rigid protections that Chapter 13 always offers.
