Final payments and Chapter 13 bankruptcy discharges

Although bankruptcy remains a structured process, many wonder how their specific proceedings will play out. Persons filing Chapter 13 bankruptcy must agree to a payment plan and meet their monthly obligations on time. After making the final payment, a Louisiana resident might wonder when the final bankruptcy discharge will occur.

The bankruptcy discharge process

The Chapter 13 bankruptcy repayment plan could take up to five years, and debtors wishing to turn the page from their past financial troubles to a new life of financial freedom could become impatient. Once they make their final payment, they likely want the bankruptcy process to conclude. Things could take longer, though.

A Chapter 13 repayment plan is not a debt consolidation loan. Things don’t end once the balance hits zero, as the judge must issue a ruling that discharges the bankruptcy. Courts have many other cases on the docket, and the court date could take a few weeks after the debtor makes the final payment.

Moving forward to the conclusion of Chapter 13

The final Chapter 13 bankruptcy court date would likely involve proving to the court the debtor completed all discharge requirements. For one, the law stipulates all bankruptcy filers complete a financial management course. Those who don’t take the course seriously and fail to complete it may discover their bankruptcy does not receive a discharge.

Statutory rules could delay the discharges, as well. Someone could file bankruptcy more than once. If someone files Chapter 13 twice, the discharge cannot occur until two years pass after the previous Chapter 13 discharge. The duration becomes longer when the last discharge bankruptcy was a Chapter 7 filing.

Debtors might find it valuable to prepare for the hopefully final day in bankruptcy court properly. Not doing so could needlessly extend the process and put the discharge off.