Only individuals with regular income and less than certain amounts of secured debt and unsecured debt can file a Chapter 13 reorganization proceeding. Chapter 13 is commonly referred to as a personal reorganization or wage earner plan, whereby the debtor pays to a trustee each month, a plan payment over three to five years. The trustee, in turn, pays creditors in accordance with court directives and the plan. This chapter has special or broader discharge provisions than in Chapter 7, which is advantageous in some situations. Chapter 13's are used primarily to save residences and repay mortgage arrearages over a reasonable period of time, while maintaining current mortgage payments. Foreclosure actions and repossession of vehicles or other secured property are stopped by the filing of a Chapter 13 procedure. Secured claims are paid over the course of the plan, which may be significantly less than what was owed under the original contract with the creditor. Unsecured creditors are typically repaid a percentage, without further interest accruing, of the debt owed at the time of filing.

When the debtor owns significant portions of property that are not considered exempt, the debtor may be forced to repay a greater percentage to unsecured creditors in a Chapter 13 proceeding. Normally, the debtor retains possession of all of his or her property in a Chapter 13 proceeding unless he or she decides to voluntarily surrender property back to creditors to eliminate debt. Repayment plans must be proposed for at least three, but not more than five years.

Due to BAPCA in 2005, debtors earning amounts in excess of the means test standard may be required to pay for five years. The amount of the plan payment depends on several variables and must be determined on a case by case basis.