Understanding the 2026 Chapter 13 Debt Limits for Baltimore Filers
Key Takeaways: Chapter 13 bankruptcy sets maximum debt thresholds for eligibility. For cases filed between April 1, 2025, and March 31, 2028, the limits are $1,580,125 in noncontingent, liquidated secured debt and $526,700 in noncontingent, liquidated unsecured debt under 11 U.S.C. § 109(e). These federal limits apply uniformly across all states. Contingent and unliquidated debts do not count toward these caps. If your debt exceeds the limits, alternatives like "Chapter 20" or individual Chapter 11 may be available.
If you are a Baltimore-area resident facing foreclosure, wage garnishment, or mounting creditor pressure, understanding whether you meet the Chapter 13 debt limits is essential to financial relief. Chapter 13 bankruptcy allows qualifying individuals with steady income to reorganize debts into a court-approved repayment plan lasting three to five years. Congress sets maximum debt amounts for Chapter 13 eligibility, updated for cases filed on or after April 1, 2025.
If you have questions about your eligibility, Sanchez Garrison & Associates, LLC is here to help Baltimore residents navigate Chapter 13. Call (410) 734-2200 or reach out to our team online to discuss your situation.
Current Chapter 13 Debt Limits: What Maryland Filers Need to Know
The debt limitations for Chapter 13 cases filed between April 1, 2025, and March 31, 2028, are $1,580,125 of noncontingent, liquidated secured debt and $526,700 of noncontingent, liquidated unsecured debt, as established by 11 U.S.C. § 109(e). These federal limits apply equally to every state. Chapter 13 bankruptcy does not impose a minimum debt requirement, but it does enforce these maximums. If your obligations exceed either cap, you generally will not qualify for Chapter 13 relief.
These limits are adjusted automatically every three years for inflation under 11 U.S.C. § 104. You can verify current numbers on the U.S. Courts Chapter 13 basics page. The U.S. Trustee Program also updated Census Bureau Median Family Income Data effective April 1, 2026, which is relevant for determining plan length and means test calculations.
| Debt Category | Chapter 13 Limit (April 2025, March 2028) |
|---|---|
| Secured Debt | $1,580,125 |
| Unsecured Debt | $526,700 |
How Secured and Unsecured Debt Limits Affect Baltimore Chapter 13 Eligibility
To determine whether you qualify, you must categorize your debts as either secured or unsecured. Secured debts are backed by collateral, such as a mortgage on your home or a lien on your vehicle. Unsecured debts lack collateral and include credit card balances, medical bills, and personal loans. Each category has its own separate cap under 11 U.S.C. § 109(e), and exceeding either one may disqualify you from Chapter 13.
Lien stripping and cramdown are two tools that can shift the balance between these categories in your favor. In certain circumstances, a Chapter 13 plan can remove or reduce a lien on secured property. The removed portion converts to unsecured debt, potentially bringing your secured debt total below the Chapter 13 threshold.
💡 Pro Tip: When calculating your debts against the Chapter 13 limits, remember that only noncontingent, liquidated debts count toward the caps. Contingent and unliquidated debts do not count, though you must still list them in your petition.
What Counts as Contingent or Unliquidated Debt?
A contingent debt depends on a future event that may or may not occur, while an unliquidated debt is one where the amount owed has not been determined. For example, if you co-signed a loan and the primary borrower has not defaulted, your potential liability is contingent. A pending lawsuit where damages have not been calculated represents an unliquidated claim. Both types must appear on your bankruptcy petition but neither counts toward the debt limit.
What Happens If Your Debt Exceeds the Chapter 13 Limits?
Filers whose debts exceed the Chapter 13 maximums have several alternatives, the most common being an individual Chapter 11 bankruptcy case. Chapter 11 is more expensive and procedurally complex than Chapter 13, with higher filing fees, more burdensome reporting requirements, and longer processing times. Chapter 7 liquidation is also an option but does not offer the same reorganization or asset protection benefits.
💡 Pro Tip: If you are close to the debt limits, ask your attorney to review whether any obligations are contingent, unliquidated, or subject to lien stripping. A thorough debt classification review may reveal that you qualify for Chapter 13.
The "Chapter 20" Strategy
One alternative for filers who exceed the Chapter 13 debt limits is the so-called "Chapter 20" approach. This strategy involves filing Chapter 7 first to discharge qualifying unsecured debt, lowering your total debt below the Chapter 13 thresholds. You then file a subsequent Chapter 13 case to address remaining obligations like mortgage arrears or car loan balances. This approach is not appropriate for everyone, and timing, eligibility for Chapter 7 discharge, and strategic considerations all play a role.
How the Means Test and Income Level Shape Your Chapter 13 Plan
The federal means test determines whether a presumption of abuse exists for individual consumer debtors seeking relief under Chapter 7. If your income exceeds the median for a household of your size in Maryland, you must complete the full means test calculation, which may make Chapter 7 unavailable. Your income level also affects the length of your Chapter 13 repayment plan, generally either three or five years. The means testing data from the U.S. Trustee Program provides the Census Bureau and IRS figures necessary to complete required bankruptcy forms.
A debtor’s plan length has practical implications for monthly budgeting and long-term financial recovery. Filers with income below the state median may qualify for a three-year plan, while those above the median typically must commit to five years of payments. Understanding where you fall before filing helps you set realistic expectations for how Chapter 13 works in Maryland and what your monthly obligations may look like.
💡 Pro Tip: Updated Census Bureau median income data took effect on April 1, 2026. If you are filing in mid-2026, confirm that your attorney is using the most current figures.
Why Baltimore Residents Choose Chapter 13 Over Chapter 7
Chapter 13 works best when you have a problem that Chapter 7 cannot solve, such as curing mortgage arrears to avoid foreclosure or preventing a vehicle repossession. Chapter 7 may discharge many unsecured debts, but it does not provide a mechanism to catch up on missed mortgage or car payments over time. Chapter 13’s structured repayment plan allows you to cure arrears while keeping your property.
The automatic stay that takes effect upon filing provides immediate relief from most creditor collection actions. Wage garnishments, creditor lawsuits, and harassing phone calls generally must stop once a Chapter 13 case is filed. However, the automatic stay may be limited for debtors who have had prior bankruptcy cases dismissed within the preceding year under 11 U.S.C. § 362(c)(3) and (c)(4). For filers with co-signers, Chapter 13 also offers a co-debtor stay that can protect family members or friends who guaranteed your obligations.
💡 Pro Tip: The U.S. Bankruptcy Court for the District of Maryland operates locations in both Baltimore (101 W. Lombard St.) and Greenbelt (6500 Cherrywood Ln.). Your filing location will depend on where you reside.
Filing Chapter 13 in Maryland: Key Steps for a Chapter 13 Bankruptcy Lawyer in Baltimore to Address
Working with a chapter 13 bankruptcy lawyer in Baltimore can help you accurately classify your debts and build a feasible repayment plan. The filing process requires full financial disclosure, including all income sources, monthly expenses, assets, and liabilities. Your proposed plan must demonstrate that you can make consistent payments over the plan period while meeting bankruptcy code requirements.
The court also offers resources for filers who need affordable legal assistance, including a Low Bono Chapter 13 program available through the U.S. Bankruptcy Court for the District of Maryland. You must show regular income sufficient to fund the plan, complete required credit counseling from an approved agency before filing, and file all necessary schedules accurately.
💡 Pro Tip: Even if you believe your debts are within the Chapter 13 limits, disputes over debt amounts or classifications can arise. Having documentation for every obligation strengthens your position if a trustee or creditor challenges your plan.
Frequently Asked Questions
1. Does Maryland have its own Chapter 13 debt limits?
No. The Chapter 13 debt limits are set by federal law under 11 U.S.C. § 109(e) and apply uniformly across all states. For cases filed between April 1, 2025, and March 31, 2028, the limits are $1,580,125 in noncontingent, liquidated secured debt and $526,700 in noncontingent, liquidated unsecured debt.
2. What if my debts are right at the Chapter 13 limit?
Borderline filers should carefully review whether any debts qualify as contingent or unliquidated. These categories do not count toward the Chapter 13 maximums even though they must be disclosed. Lien stripping or cramdown may also reduce your secured debt total.
3. Can I file Chapter 13 if I have no minimum amount of debt?
Yes. Chapter 13 has no minimum debt requirement. The only numerical constraints are the maximum caps on secured and unsecured debt. However, filing generally makes sense when you have a specific problem to solve, such as stopping a foreclosure or repossession.
4. How do I know whether my Chapter 13 plan will last three or five years?
Your plan length depends on your household income relative to Maryland’s median. If your income falls below the state median for your household size, you may qualify for a three-year plan. If your income is above the median, you will generally need to propose a five-year plan.
5. What is a "Chapter 20" bankruptcy?
"Chapter 20" is an informal term for filing Chapter 7 first, followed by Chapter 13. The Chapter 7 case discharges qualifying unsecured debt, which may lower your total obligations below the Chapter 13 limits. You then file Chapter 13 to address remaining debts like mortgage arrears.
Protecting Your Home and Financial Future Through Chapter 13
Understanding the 2026 Chapter 13 debt limits is essential for Baltimore residents considering debt reorganization. The current caps of $1,580,125 in secured debt and $526,700 in unsecured debt define who may access Chapter 13’s powerful protections, from curing mortgage arrears to halting wage garnishment. Getting accurate legal guidance early can make a significant difference in your outcome.
Sanchez Garrison & Associates, LLC has been helping Baltimore-area residents navigate Chapter 13 bankruptcy filings and build workable repayment plans. Call (410) 734-2200 or contact us today to schedule a consultation and take the first step toward regaining control of your finances.