Student Loans with 100 percent plan

[prindia]

Based on our plan we are on a 100 percent plan. This is our 2nd year and all of our secured debts has been paid. I have about 70k of federal student loans that was added to the plan but I noticed that my trustee is sending 90 percent of our payments to my student loans, is that normal? With my calculations if they pay that much towards them the other creditors will not get their 100 percent.

[justbroke]

Unsecured creditors are paid "pro rata." That means that they get an equal share based on the total value of the claim. Here's an example;

Susan has $77K of unsecured debt.
Of that unsecured debt, $70K in student loans.
The remaining unsecured debt is $7K.
Susan files a Chapter 13 bankruptcy and is in a 100% plan.
Susan's Chapter 13 Trustee pays the secured and priority debt first.
After paying off all the secured (and priority) debt, Susan's Trustee starts paying the unsecured debt.
Since the student loans account for 90% of the unsecured debt (70/77 = 90%), Susan's Trustee pays the student loans 90% of the disposable monthly income. The other creditors receive 10% of the remaining pool.

If the student loans are paid off first, then the rest of the disposable monthly income (DMI) will go to the other unsecured pool of creditors, also at a pro rata rate. I would not worry about how the Trustee is paying creditors as they have a system in place of how to pay. The bankruptcy code requires them to pay the unsecured creditors with the "highest balances" at a higher "ratio" (rata) as compared to the total of all unsecured claims filed and approved.

[prindia]

Thank you for making this clear to me! I contacted my attorney and I was even more confused after he tried to explain it to me. I guess this is a blessing because not in a million years I would be able to pay off my student loans on my own.