As with any legal matter, filing for bankruptcy is a process that takes time. Your case must go through the proper procedure, which depends on your specific situation.
In this article. we will briefly discuss how long a typical bankruptcy case may last from start to finish under two of the most common types: Chapter 7 and Chapter 13.
Before we begin, we must note that the time frames mentioned in this article are averages. Bankruptcy cases are individual matters, and specific time frames are not guaranteed.
How Long Does It Take to File Chapter 7 Bankruptcy?
Chapter 7 bankruptcy, or liquidation bankruptcy, is the most common form of bankruptcy. It can be divided into four phases:
Preparation: at least four hours. You must complete a credit counseling session and prepare the necessary forms, which will likely involve consultation with an attorney. With the proper tools, counsel, and expertise, this step could be completed in an afternoon, but you should expect it to take longer depending on your jurisdiction.
Immediately after filing: between 21 - 40 days. After filing, you will need to complete a two-hour financial management course. At the end of the 30 days is the 341 meeting between you, your court-appointed trustee, and your creditors' representatives.
341 meeting: roughly 10 minutes. At your 341 meeting, you will answer questions your trustee may have about your case.
After the 341 meeting: 60 days. In the 60 days after the meeting, creditors may object to claimed exemptions or to the debt discharge as a whole. Once the 60 days expire, the court will grant the order discharging your debts.
Combining all of the steps, Type 7 can take three to four months on average, not including the time it may take to sell a property or resolve any issues which might delay the case.
How Long Does It Take to File Chapter 13 Bankruptcy?
Chapter 13 bankruptcy, or resettlement bankruptcy, can be divided into three phases:
Preparation and first payments: 30 days. Just like Chapter 7, you must complete a credit counseling session and prepare the necessary forms. You must also submit your proposal for a repayment plan and begin making payments one month after filing.
Hearings: 2.5 hours. You must complete debtor education, answer your trustee and creditors' questions at the 341 meeting, and have your repayment plan amended or approved before a judge at the confirmation hearing.
Following the repayment plan: 3 - 5 years. Upon completing the repayment plan to your trustee and creditors' satisfaction, the court will grant a discharge order erasing any other qualifying debt.
Combining the steps together, Chapter 13 does take longer. However, it will grant you the same debt discharge if you follow the repayment plan satisfactorily.
Recap: How Long Does it Take to File for Bankruptcy?
So, how long does it take to file Chapter 7 or Chapter 13 bankruptcy?
Chapter 7: If you pass the means test and it is determined Chapter 7 is right for you, the process will take three to four months until the discharge order is granted.
Chapter 13: If you filed for Chapter 13 instead, it will take three to five years for the discharge order to be granted.
Moran Law Firm is has qualified Michigan bankruptcy attorneys that can help you determine which type of case is best for your situation. We will walk you through the entire bankruptcy process.
