It is similar to the Chapter 7 bankruptcy, with some distinctions. When the Chapter 13 case is filed, there will be a creditor’s meeting set, just as is done in a Chapter 7 filing. Once the creditor’s meeting is held, a Chapter 13 trustee is assigned and involved in the process from beginning to the end. We work with the Chapter 13 trustee to resolve any objections to the court signing a confirmation order that confirms the debtor’s Chapter 13 plan of reorganization. Once all issues are worked out, the bankruptcy court will enter a confirmation order that approves the Chapter 13 payment plan.
That plan spells out how the debtor’s secured creditors will be treated according to the plan. It also provides an amount that will ultimately go to the unsecured creditors, according to disposable income available. Once the plan is confirmed, the debtor is obliged to abide by the terms of their plan, staying current with monthly payments to the trustee. Clients are usually in Chapter 13 for 36-60 months, while we continue to shepherd them through the process.