Bankruptcy Interest Rates Increase: The Federal Reserve Strikes Again!

Interest rates on secured claims increased recently by 0.25%. The Till Interest Rate on secured claims in bankruptcy being paid through a chapter 13 plan is the prime rate of interest plus a risk factor of one to three percentage points. On March 22, 2023, the prime rate increased to 8.0%. During the same period in 2022, the prime rate stood at 3.5%.

The previous two changes in the prime interest rate as published by the Wall Street Journal were:

December 14, 2022: 7.50%
February 2, 2023: 7.75%

Given the rapid increase in interest rates, it’s imperative that creditors review chapter 13 plans for the rates they provide.

Our team is constantly monitoring this topic. If you have a question or want to connect, feel free to contact attorney Erin McCabe at any time.

This blog is not a solicitation for business, and it is not intended to constitute legal advice on specific matters, create an attorney-client relationship or be legally binding in any way.

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