How Do You Meet the Best Effort Requirement for Chapter 13?

 Posted on May 21, 2025 in Bankruptcy

Chapter 13 bankruptcy can be a powerful way for someone with a significant amount of debt to get a fresh start, all while keeping most of their assets. In a Chapter 13 case, the debtor will make a payment plan to repay their debts over three to five years, while continuing to make payments on secured debt like mortgages and car loans. It is often called the "wage earner’s plan" because it is utilized by those who have an income to make these payments. To get approval for this repayment plan, the debtor must show that it would be their "best effort" to pay back the debt. What does it mean for the Chapter 13 plan to be the "best effort" to pay back debt, and how can the debtor prove "best efforts?" Read on to find out, and speak with an experienced Austin County, TX Chapter 13 bankruptcy attorney about any further questions. 

What Is the Chapter 13 Best Effort Requirement?

In Chapter 13, the repayment plan will pay for the debtor’s unsecured debts. However, you may not be able to repay all or even most of your debt. That happens because the Chapter 13 repayment plan works by allowing you to make a doable payment plan that takes into account what you can pay based on your income. However, the court will not take you at your word about this. You must show that the total amount of debt you are committing to repay via your payment plan really represents the best effort you could make to pay back that debt. Otherwise, if you have additional income that could be used to repay that debt, your creditors, the trustee, and the court will want to know. 

How Do You Meet the Best Effort Requirement for Chapter 13 Bankruptcy?

This is where the best effort requirement comes in. When you propose your repayment plan, it must be approved by the court and will be reviewed by the bankruptcy trustee and the creditors. Before it is approved, you must show that you are paying back your disposable income to your unsecured creditors. Your disposable income is calculated by deducting your allowed living expenses and mandatory payments–like car payments you need to pay to keep your car–from your income. 

Call a Galveston, TX Bankruptcy Attorney

When you decide to file for bankruptcy, you need to speak to an experienced Harris County, TX bankruptcy attorney who can review your case and determine which bankruptcy Chapter is right for you. At The Fealy Law Firm, PC, attorney Vicky Fealy has many years of experience representing clients in Chapter 13 bankruptcy and proposing a repayment plan that works for them while meeting the "best efforts" test. She is dedicated to helping people experiencing hard times get a fresh start. Call the law firm at 713-526-5220 to schedule a free consultation.