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What must be completed in order to secure a Chapter 13 discharge?

Those who commit to filing for Chapter 13 bankruptcy know that while their decision will help them secure a fresh start, this ultimate payoff -- the discharge from debts -- won't be realized for longer than they would perhaps prefer. That's because Chapter 13 filers are only granted a discharge after completion of their court-ordered three- to five-year repayment plan.

Nevertheless, when the Chapter 13 discharge is granted, it will open up a new financial world for those who have demonstrated the necessary discipline and commitment to paying down their debts.

All this, of course, begs the question as to what additional conditions, if any, must be satisfied by the debtor before the bankruptcy court will grant the long-awaited discharge.

In general, the U.S. Bankruptcy Code dictates a Chapter 13 discharge will be granted to those who complete their Chapter 13 repayment plan and meet the following criteria:

  • They have certified, if applicable, that all preexisting domestic support obligations that came due prior to supplying the certification have been paid in full.
  • They have not received a discharge in a Chapter 7, 11 or 12 case within four years of the commencement of their current Chapter 13 case, and they have not received a discharge in another Chapter 13 case within two years of the commencement of their current Chapter 13 case.
  • They have completed, if applicable, an approved financial management course ordered by the U.S. trustee or bankruptcy administrator.

If these conditions are satisfied and the court later determines in a hearing that there is no cause to believe that a limitation on the debtor's homestead exemption will arise in another proceeding, the Chapter 13 discharge will be granted.

It's important to note that when debts are discharged, it means that not only is the responsibility to pay them terminated, but that creditors cannot undertake any sort of legal action in conjunction with these discharged obligations.

If you would like to learn more about Chapter 13 or other types of debt relief, consider speaking with an experienced legal professional who can answer your questions, outline your options and pursue solutions.  

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