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Law Office of Gordon Mosley
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The Chapter 13 bankruptcy plan and confirmation hearing


Due to their lack of financial success or the cost of living, many Texas residents may find themselves in a tight money spot. Debts can be a tremendous burden on an individual and reduce the person's quality of life. Hounded by collection agencies and a falling credit score, a debtor can choose to opt for Chapter 13 bankruptcy in order to get a fresh start and reorganize the person's finances.

Unlike Chapter 7 bankruptcy, when a debtor files for Chapter 13 bankruptcy, the debtor is allowed to retain certain non-exempt assets and enter into a repayment plan where the debtor is allowed to make timely payments to the trustee who then redistributes the funds to the creditors in accordance with the terms of the repayment plan.

In case a debtor chooses to file Chapter 13 bankruptcy, the person must submit a repayment plan along with a petition within 14 days of having entered the petition unless the court grants an extension. Even if the repayment plan has not been approved by the court after 30 days, the debtor must begin making the necessary payments to the trustee.

The bankruptcy court is required to conduct a hearing no later than 45 days after the creditor's meeting. During the hearing, the court decides if the plan submitted by the debtor is feasible and can be confirmed by the bankruptcy court. In case the court does go on to confirm the plan, the trustee will initiate the distribution of funds as per the plan and as soon as it becomes feasible.

Source: United States Courts, "Individual Debt Adjustment," accessed on March 5, 2015

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Law Office of Gordon Mosley

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