If your financial situation has deteriorated to the point where you need to file for bankruptcy, the one question that you will most want answered is, “How long will it take for the bankruptcy proceeding to be over?”
The answer to this question depends on which Chapter of bankruptcy you file. While there are numerous chapters of bankruptcy that you can file for, the two most common ones are Chapter 7 and Chapter 13.
Most people are familiar with Chapter 7 bankruptcy. This is where a person declaring bankruptcy simply can’t repay his or her debts. Therefore, the court will usually liquidate the person’s assets and then discharge their debts. Just for clarification purposes, the term ‘liquidate’ in this instance means to sell off. If there is any money left over after all of the assets have been liquidated, the person filing for bankruptcy gets to keep it.
In addition to Chapter 7 bankruptcy, there is also Chapter 13 bankruptcy. In this situation, the person claiming bankruptcy doesn’t have his or her assets liquidated. Instead, a repayment plan is developed (usually over 3 years). If the person who filed bankruptcy can adhere to the 3 year plan, the courts will forgive the remaining debt. As you can imagine, if you are being forced to file for bankruptcy by your creditors, they are going to advocate for Chapter 13 as this gives them the best chance of recovering some money.
Now that we have provided a brief overview of the 2 most common forms of bankruptcy, let’s answer the original question. If you file for Chapter 7 bankruptcy, the proceedings will be over in 4 to 6 months.
If you are forced to file for Chapter 13 bankruptcy, it can take over 3 years for the bankruptcy proceedings to cease. It takes this long because the court is making sure you adhere to the repayment plan.
Obviously, due to the enormous stress of having to go through this process, you will want to choose Chapter 7 as the way to go since it is quicker. Unfortunately, this decision is ultimately not up to you. Hence, you will want to make sure to use a bankruptcy attorney to assist in preparing your case.
If you have any further questions concerning bankruptcy, we highly recommend you visit the Dayton Lawyer Guide.
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