I have calculated my Chapter 13 plan payments and it seems I am paying more than what I owe to my creditors.

Your Chapter 13 plan payments can be hard to understand.  Your bankruptcy attorney can easily show you the breakdown of your payments.  Your payments will include any mortgage or rental arrearage you may owe.  They will also pay any secured debt that you wish to retain, such as, a car or furniture.  The secured debt that is paid through your Chapter 13 plan will be paid with interest.  Also, any priority debt (taxes, child support arrearage) will be paid through the plan.  Your unsecured debt will be paid as stated in your confirmed plan – either in full or a small percentage to this type of creditor.  In the majority of case, no interest is paid on unsecured debt.  In addition to your debt, your payment will most likely include the attorney fees and the court filing fees.  Finally, the Trustee will charge a percentage of your monthly payment to administer your plan. The Trustee fees vary by district and range from about 3% to about 11%.  While all of this seems like a lot, remember you will be out of debt soon and will not be paying the large interest rates on your credit cards.   And, this is usually much less expensive than paying interest on your credit cards and/or living with a garnishment of your wages.

Angie Seymour
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Bankruptcy Attorney Serving Augusta, GA