You’ve done it! You’ve paid off your Chapter 13 plan.

What happens next?

Here’s what you need to know. Note that this is the process for a standard Chapter 13 case, not a case where you’ve chosen to try to pay off your Chapter 13 plan early. This is also not the same as a Chapter 13 case which has been dismissed, as a dismissed case indicates a Chapter 13 case that has not been completed successfully.

The Trustee Conducts an Audit

The trustee has to make sure that all amounts owed under the plan were received. Once they have done that, the trustee files a Certificate of Final Payment with the bankruptcy court.

You must continue making your plan payments until you have a copy of that Certificate in hand. 

If your plan contained a Wage Order that deducted your plan payments from your wages then the trustee will ask the bankruptcy court to vacate that order. 

Don’t worry about overpaying. If you overpay the trustee will issue a refund. Just make sure your address is current with your attorney and with the bankruptcy court.

The trustee will also mail a Motion of Entry of Discharge to your attorney at this time. You will have some paperwork to fill out. Make sure you consult with your bankruptcy attorney before doing so.  

You Begin Repaying Original Debtors Again

Some people file Chapter 13 so they may save their homes or cars. In addition, sometimes child support and student loan payments end up part of the Chapter 13 plan, as will other nondischargeable debts. 

Once the plan is complete you’ll need to start paying those creditors on their regular schedule again. Don’t wait for them to ask for payment. Just start paying them. 

Final Report and Discharge

The trustee will file a final report that summarizes all the payments made over the life of the plan, and who the trustee paid the money to. 

The judge then issues an Order of Discharge. Retain a copy of this order for your records, as it serves as legal proof that your debts have been discharged and that your Chapter 13 case has been successfully completed. 

Once you have received a Discharge your bankruptcy case is over. All dischargeable debts are wiped clean, and you no longer have any legal obligation to pay them. 

Need help?

If you are in financial trouble, a bankruptcy fresh start might be perfect for you, but Chapter 13 is complicated and you shouldn’t attempt it alone. Contact our office to schedule a free case review today. 

See also:

Can Bankruptcy Stop Foreclosure in New York? 

What is a Chapter 13 Hardship Discharge? 

What Will Your New York Chapter 13 Payment Look Like?