Confirmation

A confirmation in bankruptcy is a bankruptcy judge's approval of a plan of reorganization or liquidation in Chapter 11, a payment plan in Chapter 12, or a payment plan in Chapter 13.

Confirmation of a plan in a Chapter 11 Bankruptcy normally involves the filing debtor in possession combining with seven of the business' largest unsecured creditors, who have formed a committee appointed by the U.S. Trustee or Administrator, to devise a plan to repay the business debts over time. The plan is then submitted to the bankruptcy court for the judge's confirmation. Small business filings, under a Chapter 11, handle the confirmation of the plan differently. The U.S. Trustee or Administrator normally works directly with the filing debtor or debtors of a small business to help them devise the confirmation plan.

Chapter 12 and Chapter 13 plan confirmation are similar with the exception of confirmation hearings and deadlines. The debtor submits a formal, written plan to the bankruptcy court, and the creditors and trustees are given a specified amount of time to hold a confirmation hearing, allowing for creditors or the trustee to object to the proposed plan. If there are no objections, the plan is submitted to the District Court judge for approval. If there are objections to the plan, an Adversary Proceedings may be held or the debtor will have to make changes to the plan. Once confirmed by the bankruptcy judge, the plan is implemented as designed.