How Long Does It Take to File Bankruptcy?

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How Long Does It Take to File Bankruptcy?

Whether you are filing a Chapter 7 or Chapter 13 case in Georgia, it helps to understand the potential timescales. There are a number of factors that will come into play depending on the exact scenario. However, here is a general guideline for each Chapter.

Chapter 7

A Chapter 7 will usually take 5-6 months from the date of filing to the point where discharge is obtained. This is based on income that is lower than the household median, where there are no assets involved in the case and where no creditor objects to the discharge.  A typical case will involve the following elements:

  • Petition is filed with the court;
  • A stay of protection against creditors automatically exists from the moment of filing;
  • Creditors are notified of the case filings by the Clerk of Court;
  • A Meeting of Creditors is scheduled;
  • The trustee issues a report of assets;
  • Creditors are given a period, approximating 90 days from filing, to file discharge objections;
  • Debtor takes a mandatory financial management course within 45 days, from the date of the Meeting with Creditors;
  • The court receives the financial management filing and issues an order discharging debt, where applicable

Assets can cause a delay in the normally expected timeframe for a Chapter 7. The trustee is responsible for liquidation and administration of assets. However, exemptions protect assets such as cars and homes, which account for the most equitable possessions in the majority of cases. Income may create complications where the debtor earns more than the average household income. In this scenario, it must be shown that sufficient disposable income does not exist. There are a number of deductions through which this can be achieved, which may include medical expenses and supporting the education of children.

If creditors raise objections to discharge, the process may be further held up when you file bankruptcy under Chapter 7. An objection to discharge must be filed as an adversary proceeding, a lawsuit which involves litigation to resolve the issue of whether the creditor has a valid objection to the discharge of debt. An effort to remove liens on a property is another fairly common reason a Chapter 7 takes longer than usual. If such scenarios exist, it is important to discuss them with an experienced lawyer before you file bankruptcy under Chapter 7.

Chapter 13

The timeframe for a typical Chapter 13 is between 3 to 5 years, due to the need to reorganize finances with a payment plan over a longer period of time when you file bankruptcy using this method. Much like with Chapter 7, there is a set process which can be negatively affected by a number of scenarios:

  • Case is filed with a payment plan and petition;
  • Creditors are prevented from collecting through a stay;
  • Bankruptcy notice is issued by the Clerk of Courts;
  • Meeting of Creditors is scheduled approximately 30 days from filing;
  • Confirmation hearing is scheduled approximately 60 days from filing;
  • First monthly payment is due 30 days after you file bankruptcy;
  • Post Meeting of Creditors, Chapter 13 trustee may file objections to confirmation;
  • An order is issued by the court “confirming” your case, so long as objections are cured;
  • Creditors may file “proofs of claim” to be paid;
  • Debtor continues to make payments for a period of 3 to 5 years after confirmation;
  • Debtor completes a financial management course and files a discharge request certificate in order to and discharge and close the case.

Quite a number of complications can arise during the course of a Chapter 13 when you file bankruptcy, given the time frame. You can speak to the experts at H. Lehman Franklin by taking advantage of a free consultation today. Simply give us a call and share the details of your circumstances and we will begin the process of helping you decide which option is most likely to help you better manage your finances.