A chapter 13 bankruptcy is also called a wage earner's plan. It enables individuals with regular income to develop a plan to repay all or part of their debts. Under this chapter, debtors propose a repayment plan to make installments to creditors over three to five years.

If the debtor's current monthly income is less than the applicable state median, the plan will be for three years unless the court approves a longer period "for cause." If the debtor's current monthly income is greater than the applicable state median, the plan generally must be for five years. In no case may a plan provide for payments over a period longer than five years. During this time the law forbids creditors from starting or continuing collection efforts.

In Oregon, as in other states, Chapter 13 bankruptcy is designed for individuals with a regular income who wish to repay their debts over a period of time. This is often referred to as a 'wage earner's plan.' Debtors who file under Chapter 13 must propose a repayment plan to pay back creditors in installments. The length of the repayment plan depends on the debtor's income relative to the state's median income. If the debtor earns less than the median income for Oregon, the repayment plan will typically last three years, unless the court finds justification to extend it. However, if the debtor earns more than the median income, the repayment plan is generally set for five years. Legally, the repayment plan cannot exceed five years. During the repayment period, creditors are legally prohibited from pursuing collection actions against the debtor.