chapter 13 bankruptcy

A chapter 13 debtor’s plan of reorganization is set forth in a chapter 13 plan.  Unlike chapter 11, only the debtor is allowed to file a plan.  A chapter 13 plan must include the mandatory provisions set forth in the bankruptcy code and may also include other permissive provisions. A chapter 13 plan is usually three to five years long.

Chapter 13 Plan Confirmation

A chapter 13 debtor’s proposed chapter 13 plan is set for hearing before the Bankruptcy Court for confirmation at a confirmation hearing. The parties to the case, including the creditors, receive notice of the confirmation hearing and have the opportunity to object to confirmation. If the plan is approved, the Bankruptcy Court will issue a confirmation order.

Pursuant to the bankruptcy code, the confirmation order is binding upon the debtor and all creditors.  This means that creditors are required to abide by the terms of the plan and are barred from taking actions that are inconsistent with the plan.

Chapter 13 Discharge

Upon completion of the payments provided for in the chapter 13 plan,  the debtor is generally entitled to the issuance of his discharge order. In some cases, a debtor may obtain a “hardship discharge” even though all required payments are not made.