Generally, the Automatic Stay is a temporary injunction that goes into effect immediately upon the filing of a bankruptcy petition.  It prevents most creditors from continuing to try to collect their debts from the debtor and the debtor’s property.  The provisions of the Automatic Stay are found at 11 U.S.C. Section 362(a).

The discharge is a permanent injunction issued by the Bankruptcy Court (usually at the end of a bankruptcy case) which prohibits creditors from trying to collect certain debts from the debtor and the debtor’s property.

This is a highly-debated topic nationwide.  Presently, in order to discharge student loans, a debtor must meet a very difficult standard:  the debtor must prove to the Court that not discharging the student loans would create an “undue hardship” for the debtor.  Essentially, this means that the debtor must show that the debtor cannot maintain a minimal standard of living if forced to repay the loans, that circumstances exist indicating that this situation is likely to persist for a significant portion of the student loan repayment period, and that the debtor has made good faith efforts to re-pay the loans.

Priority debts are a separate class of unsecured debt which receive preference over (they get paid before)  general, unsecured debts. The most common examples of priority debts are recent income taxes and past-due child support/alimony obligations.  The list of priority debts is set out at 11 U.S.C. Section 507.

A secured debt is a debt where the creditor holds a lien or other security interest in the debtor’s property.  Mortgages, title loans, and judgments are some examples of secured debts.

A discharge in bankruptcy is limited to the individual debtor who filed the bankruptcy case.  Your co-debtor’s liability will not be affected by your discharge and the creditor may still pursue the co-debtor.  Chapter 7 does not have any provision for protecting co-debtors.  Chapter 13, however, has the co-debtor stay (11 U.S.C. Section 1301) which prevents collection actions against the co-debtor and allows the debtor to re-pay that debt in full through the plan.

The 341 Meeting of Creditors is a mandatory hearing in every Chapter 7 and Chapter 13 case.  See 11 U.S.C. Section 341(a).  In Chapter 7 cases, the 341 Meeting allows the trustee to question the debtor regarding any assets that might be available to liquidate for the benefit of the debtor’s creditors.  In Chapter 13 cases, it allows the trustee to interview the debtor to see if (a) the proposed plan meets the requirements of the law; and, (b) the debtor is performing the requirements of the plan.

In Chapter 7 cases, the trustee is an individual appointed to find, collect, and liquidate any of the debtor’s  non-exempt assets and distribute the proceeds to the debtor’s creditors.  In Chapter 13 cases, the trustee monitors the case to ensure that the plan complies with the law and that the debtor is complying with the plan; the Chapter 13 trustee also receives, distributes, and accounts for the plan payments.

When enacting the bankruptcy laws, Congress made a policy decision to allow debtors to retain a minimal amount of their assets so that when they exited bankruptcy they could still contribute as viable members of society.  Exempt property is property which a debtor is allowed to keep exclusively from the reach of the trustee and creditors.  The exemption laws vary from state to state and a debtor’s decision regarding which chapter to file under often hinges upon which state’s exemptions that debtor is allowed to claim.  In order to take advantage of an exemption, the debtor specifically must claim the property as exempt in his or her bankruptcy schedules.  Otherwise, the property will be part of the bankruptcy estate.

Confirmation is simply the Bankruptcy Court’s approval of the debtor’s proposed Chapter 13 plan.  The order confirming the plan binds the debtor and all creditors to the terms of the repayment plan.  See 11 U.S.C. Section 1327.

A reaffirmation agreement is a voluntary agreement between the debtor and a creditor in a Chapter 7 case.  It allows the debtor to retain the creditor’s collateral and sets forth a re-payment arrangement which will not be discharged in debtor’s case.  The agreement must be made before the discharge order is entered and must be filed in writing with the Court.  The debtor may rescind the agreement upon notice to the creditor either before the discharge order is entered or within 60 days after the agreement is filed with the Court, whichever is later.

The Applicable Commitment Period is the minimum length of time that a Chapter 13 case must last when the debtor is not proposing to re-pay his or her creditors in full.  For “under the median” (lower income) debtors, the ACP is 36 months.  For “over the median” (higher income) debtors, the ACP is 60 months.  The ACP should not be confused with the actual time the case is projected to last.  Many attorneys calculate Chapter 13 plans to run 60 months in order to keep the plan payments lower, even though the ACP only requires 36 months.