Your Case has Been Confirmed!

I was on the phone the other day with one of my chapter 13 clients, telling him the great news:  "Your case has been confirmed!" I said gleefully.  There was a pause on the line.
"What does that mean?" he finally asked, worried maybe that his case was confirmed DOA or confirmed some other horrible status.  I realized I hadn't properly explained the beauty of "confirmation" in a chapter 13.

I am an attorney who files a ton of Chapter 13 Bankruptcy in Salt Lake City in Ogden, so I go through this process all the time.  It's no wonder that folks who aren't in the bankruptcy trenches would be befuddled by "confirmation."

See, Chapter 13 bankruptcy is the kind of bankruptcy where we take all of your debts and wrap them up into a single monthly payment plan.  After I write up your plan and present it to the bankruptcy judge, he "confirms" it.  That's confirmation and it's a good thing.  No, it's a great thing because for a very low monthly payment you can stop all the crazy garnishments and collection activities and harassment.

Most of my chapter 13 clients pay only $100 per month and they pay it for 36 months.  At the end of their plan, whatever hasn't already been paid off just gets wiped out.  Doesn't matter if you have $2,000 of debt or $200,000 of debt.  What matters is the kind of debt you have and if you're like most folks, you've got the usual menagerie of medical bills, credit cards, or payday loans.  I call all of this "junk" debt but in legal terms it's called "non priority, unsecured" debt.  Call it what you want but in chapter 13 you end up paying back very, very little of it.  Hence, only $100 per month on your payment plan in most cases.