Forest View Bankruptcy Attorney Talks Chapter 13 Discharge

A Chapter 13 discharge will occur after you have completed all of your required payments under your Chapter 13 plan, states Forest View bankruptcy attorney.  Typically, a Chapter 13 plan is going to last anywhere from 3 to 5 years with creditors receiving anywhere from 10% to 100% of the underlying debt.  In a typical Chapter 13 bankruptcy case where you are saving a house from foreclosure, the mortgage arrearage portion gets paid back over the next 3 to 5 years and when you receive your discharge, you have brought your mortgage to the reinstatement stage.  In other words, you do not have any more arrearage and you just have to make your regular mortgage payment going forward. 

As far as a vehicle goes, the entire vehicle debt in a financed vehicle situation is paid through the Chapter 13.  Once the Chapter 13 payment plan is complete and you receive a discharge, you will also receive the title to your vehicle.  Additionally, unsecured creditors can be paid back anywhere from 10% to 100% depending upon the nature of your case and the amount of money you have available for creditors. 

Once you have completed all of your required payments under your Chapter 13 which can be anywhere from 36 to 60 months, you will then receive a discharge letter as will all of your creditors and your attorney.  The discharge letter means that your case has gone through to completion and no creditors can bother you on those debts again.  Thus, if you paid a credit card company $.10 on the dollar, that credit card company cannot seek the other 90% that was not paid from you.  The Chapter 13 discharge effectively discharges the debt.  It eliminates whatever was remaining on the debt that wasn’t paid and you get a fresh start. 

Chapter 13 discharges will only come at the end of your payment plan so you can’t necessarily and your bankruptcy case early except for hardship cases which must be done upon motion before the court.  Chapter 13 discharge should be kept in a safe place so if any creditor seeks to bother you on those debts again, you can forward that creditor a copy of your discharge so that they stop any collection efforts.