How Long Does it Take to File Bankruptcy?

It’s understandable to be curious – and perhaps anxious – about the length of time a bankruptcy takes. The timeline for bankruptcy depends in large part upon which type of bankruptcy you file – Chapter 7 or Chapter 13.

How long does it take to file Chapter 7 bankruptcy?

When most people think of filing for bankruptcy, Chapter 7 is what comes to mind. Chapter 7 bankruptcy liquidates your assets, repays your creditors to the fullest extent possible, and then erases the remainder of your eligible debts. Generally speaking, only those whose incomes fall at or below the median income for their state are eligible to file Chapter 7 bankruptcy.

As for how long it takes to file Chapter 7 bankruptcy, let’s say that you file your bankruptcy petition with the court on August 1. Your case trustee will schedule a meeting of creditors between August 22 and September 9. For the sake of our example, let’s say the meeting of creditors occurs on September 1. If yours is a typical case, your debts will be discharged between November 1 and December 1 of that same year.

How long does it take to file Chapter 13 bankruptcy?

If you are not eligible to file Chapter 7 bankruptcy or prefer that your assets not be liquidated, then you may be able to file for bankruptcy under Chapter 13. This type of bankruptcy reorganizes your debts, and puts you on a repayment schedule based on your disposable income. At the end of your repayment schedule, remaining balances from eligible debts are discharged.

Let’s say that you file your Chapter 13 bankruptcy on August 1. Your case trustee will schedule a meeting of creditors between August 22 and September 19. If you live in a location that doesn’t have regular trustee staffing, that deadline extends to September 29.

If you file on August 1, then you are required to file a repayment plan by August 15. By August 30, you’re required to start making payments according to your repayment plan.

Let’s say that the meeting of creditors was held on September 1. The court must hold a hearing on your repayment plan by October 15. If the court approves the plan, then you need to adhere to the plan by making regular payments to the trustee. If your income is at or below the median income for your state, you will make payments for three years. If your income exceeds the minimum for your state, you will make payments for five years. After that time, then any balances on eligible debts will be discharged.

Preparation time for filing for bankruptcy

Regardless of which type of bankruptcy you choose to file, it takes considerable time to prepare your bankruptcy filing. For example, for Chapter 7, you need to file forms listing your assets and liabilities, your income and expenditures, your tax returns, and a variety of other information. You also need to file a certificate saying you have participated in credit counseling. A bankruptcy petition can easily run 100 pages or more. The same is true for a Chapter 13 filing.

When it comes to filing bankruptcy, it pays to have a skilled attorney by your side in order to create a petition that will avoid delays.