A man with a toothache cares about only one question — when will the pain go away? For most people, filing for bankruptcy shouldn’t be as painful as a toothache, but even the most sanguine of debtors are often curious about when their case will be over.
For a consumer Chapter 7 case with no special legal issues other than the debts themselves, I tell people to expect that it will be done in about four months. This is calculated as follows:
* About two weeks to gather documents and the attorney’s fee and filing fees, prepare and review drafts of the bankruptcy petition.
* From the actual filing date, about one month until the meeting of creditors is held at the trustee’s office.
* Then there is a two month period to wait to see if any objections are received. Kind of like a wedding: “Speak now or forever hold your peace……”
* Assuming there are no objections, it may take another two weeks for the discharge to issue and the case to be closed. So about four months, soup to nuts.
Of course, cases with complications will take longer. What sort of complications? Well, the most common one by far is that the trustee is going to sell some of the debtor’s non-exempt property. In that event, the case will remain open until the property is sold — several extra months at a minimum.
Chapter 13 cases present a whole different time line. In Chapter 13, debtors file a plan for paying off a percentage of their debts through monthly payments. The bankruptcy code specifies that the length of the plan must be between three and five years. Therefore, the typical Chapter 13 case — if it is pursued to completion — should be expected to last between three and five years.
As always in the law, there are exceptions. If a debtor is able to propose a plan that pays 100% to the unsecured creditors, the plan length can be shorter than three years — essentially it can be any length shorter than 60 months the debtor can swing. A debtor who has big mortgage problems, but relatively little credit card debt, for example, may fit into this category. Also, some debtors may have properties that can be sold to pay the debts, but they need time — breathing room to stave off a foreclosure, for example.
by Doug Beaton