What we are talking about basically is the Chapter 13 plan. It’s the reorganization plan. And the debtor is required to not only prepare a plan which they do through an attorney, but they need to execute the plan. If the monthly payment in the plan is not enough, the case will not be recommended by the court and the case will die on the vine within about two or three months. If by chance we get it confirmed, which is the technical word where the court approves it, the trustee has given his approval as well and the debtor is current at the time, current on their payments, because they wont approve any plan if the debtor is not current. If they cant make payments one, two, three and four, how are they going to go 3 to 5 years? So, they have to be current to get it approved.
But once its approved, its called confirmed and once you have been on a confirmed plan, it is binding. You have got your protection from your creditors as long as you make your payments. The end result will be your mortgage arrears will eventually be paid off, your car will be paid off, you will get an auto title and all of your debts will be paid not necessarily in full but whatever the proposal says they are going to be paid back at. Thats where the old – youve heard of the $.10 on the dollar business? Some creditors get $.10 on the dollar, some get 100%. The truth is, it is usually somewhere in between. Even when you propose a 10% payment plan, not every creditor becomes part of the plan. So the creditors that actually do become part of the plan, usually get more than 10%.
See Also Cicero Bankruptcy Attorney or call (847) 520-8100.
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