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Q.How does the Chapter 13 plan work?
A.A Chapter 13 debtor will present a 3 to 5 year plan for debt repayment. The Plan will then be reviewed by the Chapter 13 trustee, the debtor's creditors and the Bankruptcy Court to ensure the plan: (a) was filed in good faith, (b) provides for payments that are feasible in light of the debtor's income and expenses, and (c) provides for payments that equal or exceed the amount of money creditors would have received had the debtor filed a Chapter 7 bankruptcy. If the plan is approved by the court, and the debtor makes all of the required payments, the debtor will receive a discharge.
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