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Bankruptcy Confirmation

Definition - What does Bankruptcy Confirmation mean?

A bankruptcy confirmation is the official approval that a court gives to any bankruptcy plan. A court will not provide confirmation of a bankruptcy plan until all the creditors are in agreement with it, and also until all other factors have been worked out. If a plan presented to the court is unjustified or unfair to any creditor, a judge may refuse to confirm the plan until it is deemed acceptable. Chapter 13 bankruptcy plans are more likely to be scrutinized by a judge in order to ensure that they are fair and equitable because the amount of time involved in repayment usually spans several years.

Justipedia explains Bankruptcy Confirmation

Once a bankruptcy plan has been confirmed, all parties are required to comply with its terms. The amount a creditor is repaid, and the rate at which it is done, is formalized within a confirmed bankruptcy plan. A confirmation of bankruptcy is important for all sides of the agreement because it dictates the relationship between the parties in a bankruptcy.

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