What Is A Chapter 13 Bankruptcy Discharge?
A Chapter 13 discharge is a court order releasing a debtor from all dischargeable debts and ordering creditors not to collect them from the debtor. A debt that is discharged is one that the debtor is released from and does not have to pay. There are two types of Chapter 13 discharges: a full or successful plan discharge, which is granted to a debtor who completes all payments called for in the plan, and a partial or unsuccessful plan discharge, which is granted to a debtor who is unable to complete the payments called for in the plan due to circumstances for which the debtor should not be held accountable.
A full discharge is granted upon the completion of all payments required by the Chapter 13 Plan, and discharges a debtor from all debts except for debts:
- paid outside of the plan and not covered by the plan,
- for alimony, maintenance, or support
- for death or personal injury caused by the debtor’s operation of a motor vehicle while unlawfully intoxicated,
- for restitution of criminal fines included in a criminal sentence imposed on the debtor,
- for federally backed student loans or educational obligations, and
- incurred while the plan was in effect that were not paid under the plan.
A partial chapter 13 discharge granted when a debtor is unable to complete payments under a plan due to circumstances for which the debtor should not be held accountable, and discharges the debtor from all debts except:
- secured debts (i.e., debts secured by mortgages or liens),
- debts that were paid outside of the plan and not covered in the plan,
- installment debts whose last payment is due after the completion of the plan,
- debts incurred while the plan was in effect that were not paid under the plan, and
- debts that are not dischargeable under chapter 7.
If you are considering filing for Chapter 13?