A Chapter 13 confirmation hearing is a court proceeding at which a bankruptcy judge decides whether someone has sufficient income to qualify for Chapter 13 bankruptcy. At the confirmation hearing, the judge reviews the filer's proposed plan to repay creditors. The plan is "proposed" because it isn't accepted automatically. Someone can object to it if it appears a creditor isn't getting paid the right amount.
A bankruptcy judge has the final say and will either approve or reject the proposed plan at the Chapter 13 confirmation hearing. Read on for more about what's involved in confirming your Chapter 13 plan, including:
You'll also learn when the bankruptcy court will set your confirmation hearing and whether you'll have to attend.
A Chapter 13 confirmation hearing is a court proceeding where a bankruptcy judge determines whether the proposed repayment plan meets bankruptcy requirements. Simply put, you must show you have enough income to pay everything required in a Chapter 13 plan.
Unlike the 341 meeting of creditors, the Chapter 13 confirmation hearing takes place in a courtroom before a judge, not in a hearing room. When your case is called, you and your lawyer will take your places at the front and answer the judge's questions about your plan.
Before the hearing, a creditor or the Chapter 13 trustee appointed to manage your case can file written objections to your plan. When that occurs, the judge will listen to the creditor or trustee's oral arguments about why a plan shouldn't be approved or "confirmed." You or your attorney will have an opportunity to refute the arguments.
Everyone who might receive money through the repayment plan can review it and decide if they agree with the provisions. You'll likely be well aware of the objection long before the confirmation hearing and, like many filers, will have made an effort to resolve the problem informally.
Here's who might object to your Chapter 13 plan and why.
The Chapter 13 bankruptcy trustee's job is to review the plan to ensure it complies with bankruptcy laws. The process includes reviewing the income and expense information you included with your bankruptcy petition. The review helps the trustee determine if your creditors are getting adequate repayment.
A bankruptcy trustee might object to your plan doesn't appear "feasible" because you should be paying more, don't make enough income to afford your monthly payments, or for some other reason.
Most Chapter 13 trustees will talk to you about any plan issues they see at the 341 hearing and attempt to resolve them because they are interested in your plan approval. Chapter 13 trustees receive up to 10% of every dollar you pay your creditors through your plan. Learn more about how trustees get paid.
Most objections involve how much a creditor should get paid, although an unsatisfied creditor can object to anything that affects the creditor. For instance, a creditor can object to something filed by the debtor, a course of action proposed by a bankruptcy trustee, or even a position taken by the judge.
So even though filing for bankruptcy is an efficient way to stop creditor collection efforts in their tracks, it doesn't silence creditors altogether or prevent them from participating in a bankruptcy case.
If you do one of these things, the trustee or a creditor might object to a Chapter 13 plan confirmation:
The trustee or a creditor might file an objection in one of these areas because they all have the potential to increase the amount a creditor might receive.
Other payment-related objections can arise at different times during the Chapter 13 case. For instance, the trustee, creditor, or debtor might object if a creditor seeks payment for an uncollectible proof of claim or the debtor's attorney or a court-appointed professional requests an unreasonable fee.
Learn more about your obligations under a Chapter 13 bankruptcy plan.
If the original or amended plan is satisfactory, the judge will confirm the plan. If confirmed, expect the court to ask you or your lawyer to submit a confirmation order for the court's review.
If the trustee or a creditor raises a valid problem, most judges will give the debtor time to fix the issue and prepare an "amended" or new proposed plan, and set a new confirmation hearing date.
The judge will dismiss the case if it's obvious you can't remedy the problem, or if you fail to fix the issue after several attempts.
Some judges require debtors to be present at the Chapter 13 confirmation hearing for questions. However, in many districts, your appearance won't be necessary if counsel represents you and attends on your behalf. In other districts, the court might not hold a hearing if no one objects to your plan.
A confirmation hearing will occur within 45 days of the meeting of creditors date. Some courts schedule a confirmation hearing soon after the 341 meeting of creditors, while others don't calendar it until weeks later. You'll likely have enough time to work with the trustee to modify your proposed plan.
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