How Long Does Bankruptcy Take?
Have you been struggling with debt problems for a long time? If so, making the difficult decision to file for bankruptcy relief is a big step. For many people, once they make the decision to file bankruptcy, they want to get it done as soon as possible so they can get on with their lives free from the burden of overwhelming debt. Therefore, one of the most common questions we answer is, “When will my bankruptcy be over?”
Chapter 7 Bankruptcy
Cases filed under Chapter 7 of the Bankruptcy Code are also known as “liquidation” or “straight” bankruptcy cases. In a Chapter 7 case, a bankruptcy trustee evaluates the debtor’s assets to determine if any of the assets have non-exempt equity. If an asset has equity that is not protected by a bankruptcy exemption, the trustee may liquidate the asset and use the funds to pay the debtor’s creditors on a pro-rata basis. Almost all Chapter 7 cases filed in Texas, Florida and Arizona, are no-asset cases. In a no-asset case, the debtor retains all of his or her property. A no-asset case is usually closed within 4 to 5 months after the filing date.
Chapter 13 Bankruptcy
Cases filed under Chapter 13 of the Bankruptcy Code are also known as “reorganizations.” In a Chapter 13 case, the debtor proposes a bankruptcy plan outlining how the various creditors will be treated in the bankruptcy. The debtor makes monthly payments to a Chapter 13 trustee and the trustee disburses those payments according to the terms of the confirmed bankruptcy plan. The length of the bankruptcy case is based on the length of the bankruptcy plan. Most plans require the debtor to make payments for 60 months; however, a few plans are 36 months in length. Once all payments are made to the trustee, the trustee will complete a final accounting and the case will be closed.
If you are struggling with overwhelming debt, contact Weston Legal, PLLC to discuss your bankruptcy options. You have options for dealing with your financial problems and we will help you find the solution that is best for you.