The U.S. Senate is expected to consider an amendment that would temporarily raise Chapter 13 bankruptcy debt limits by replacing the current $1.58 million (secured) and $526,000 (unsecured) caps with a single $2.75 million ceiling. The proposal—packaged with the national defense bill—would also restore Subchapter V’s small-business bankruptcy threshold to $7.5 million and apply retroactively to bankruptcy cases filed during the lapse.
In Bloomberg Law’s coverage, Wolfson Bolton Kochis bankruptcy attorney Michelle Bass called the pre-pandemic limits “obsolete, arbitrary gatekeepers,” noting that inflation and rising housing, medical, and student-loan costs have pushed many wage earners and entrepreneurs outside Chapter 13 bankruptcy eligibility. She added that raising the bankruptcy debt limits would help families and small-business owners access reorganization relief rather than being forced into costlier or less suitable bankruptcy chapters.
Read the entire article at Senators to Weigh Raising Chapter 13 Debt Limits for Consumers
Source: Bloomberg Law, “Senators to Weigh Raising Chapter 13 Debt Limits for Consumers,” Sept. 2, 2025.
