The automatic stay and other forms of bankruptcy protection can offer great relief for people in financial distress. The bankruptcy code presents different types of bankruptcy; however, for personal bankruptcy, the two main choices are the liquidation bankruptcy chapter (7) and the reorganization bankruptcy chapter (13).

While a Chapter 7 bankruptcy filing is a quicker and usually simpler debt settlement solution, Chapter 13 appeals to a good number or filers since it has the draw of a super discharge. It also allows the debtor to keep his property on the condition that he fulfills the approved debt reorganization plan. There’s a process to it, so you should know what to expect before you file a bankruptcy petition under Chapter 13.

As mentioned, Chapter 13 bankruptcies require the debtors to come up with a debt repayment plan that the bankruptcy court would approve. Sometimes, the other parties involved do not accept the plan, in which case, the objecting creditor or the bankruptcy trustee of the bankruptcy case raises a dispute that the bankruptcy judge has to address in a confirmation hearing.

Chapter 13 Bankruptcy Confirmation HearingCreditors may object to proposed actions by anybody from the debtor to the judge. The objecting creditor in bankruptcy usually disputes the debtor’s proposed payment plan, the expenses or the bankruptcy exemptions being claimed, and certain debts to discharge. A creditor may also question the trustee’s choice not to liquidate an asset, which would otherwise have helped to pay off the filer’s debts.

The trustee may have his or her own objection. It could involve the plan to pay back debts if it’s not adequate according to bankruptcy laws. The trustee may also object if he or she deems the bankrupt debtor’s monthly income to be insufficient to fulfill his proposed monthly payments.

There are bankruptcy filings that are not met with objection. In this case, the judge may simply review the debtor’s submitted confirmation order. In some bankruptcy cases with no objections, the judge may still choose to hold a hearing to talk to the debtor about the proposed plan.

Adversary Proceeding

An adversary proceeding must be filed within 60 days of the first scheduled date of the meeting of creditors if a creditor or the trustee generally objects to a bankruptcy discharge. The objecting party must back his or her objection with proof that the debtor has shown egregious wrongful conduct, like fraud, perjury, property destruction, or any other criminal or quasi-criminal involvement. This is an unusual occurrence, however.

Objection to a Specific Debt

It is more common for a creditor to object to a particular debt’s discharge. The dispute usually arises because of serious misconduct or intentional wrongdoing on the debtor’s part, but it may also be caused by something less serious such as failure to include the debt in the submitted bankruptcy documents. A sustained objection will lead to that debt being excluded from the list of dischargeable debts upon finishing the debt payments and the entire bankruptcy process.

Confirmation Hearing

The confirmation hearing is the venue for all parties to air their side and defend their position. Debtors need not attend if they’re represented by bankruptcy lawyers, although there are cases when judges insist on attendance so they could directly question the people involved. In fact, a hearing may still be scheduled without objection from a creditor or the trustee if the judge has concerns about the debtor’s ability to execute the plan and make payments monthly.

Objection Resolution

Bankruptcy judges don’t typically issue a final determination at the first hearing, giving the different parties to resolve the dispute on their own. On the occasion that the debtor, the creditors, and the trustee cannot come to an agreement, the judge will decide based on the evidence provided by the different sides.

Filing Bankruptcy May Be the Answer! Consult an Arizona Bankruptcy Attorney Now!

If you plan to file for bankruptcy, it is best done with the legal advice of a bankruptcy lawyer. Guidance is invaluable all throughout the process, from the time of accomplishing bankruptcy forms and gathering documents before filing, through actual bankruptcy proceedings, and even after bankruptcy.

Find your way out of financial problems with the right debt relief solution. Declaring bankruptcy could be the answer to get you out of debt. You can ensure that you optimize the provisions of bankruptcy law by getting legal help in filing for bankruptcy. For legal guidance and representation, call us at Zolman Law to speak with one of our experienced Arizona bankruptcy attorneys.