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How long does the entire bankruptcy process take?

Posted On 2011 Sep 30
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ATTY. PAUL M. ALLEN

IF YOU are seriously contemplating bankruptcy, you have probably held on financially as long as possible, for months or even years. There is no doubt that financial pressure you and your family have been under has been substantial. Once you decide to move forward, you may want the process to be over with as quickly as possible. One of the more popular questions a bankruptcy filer will ask is “how long will it take?”

Part of this will depend on what type of bankruptcy you file, and how long it takes to prepare your paperwork and petition. Cases that are more complex of course can take much longer. The more assets you own, or complex transactions involved can stretch the time out in some instances.

Chapter 7

How long your bankruptcy will take primarily depends on what chapter of bankruptcy you are filing. In order to understand the time frame you might be dealing with, it is important to have an understanding of the processes involved. Bankruptcy is a process of liquidating your estate, and paying off your creditors. Whatever debts cannot be paid will be discharged at the conclusion of the bankruptcy process.

When you meet with your attorney, you will provide him with all of your information including pay stubs, tax returns and copies of credit reports or bills. Your lawyer will set to work preparing your bankruptcy petition and schedules. The time taken to complete this paperwork of course will be up to the lawyer and his staff, and will depend on how complex your estate is.

Once the petition is filed, your case is officially opened. One great thing about this is that just as soon as your paperwork is filed, your creditors must stop all collection efforts. This means no more annoying phone calls, or daunting letters in the mail. The protection is called an “automatic stay” and is a helpful feature of filing bankruptcy. After you have filed, you will obligated to make a single court appearance, called the Meeting of Creditors. This meeting takes place within 4-6 weeks after your initial filing. You are eligible to receive your discharge of debts 60 days after the meeting of creditors. The average time for the whole process is about 3 ½ to 4 months.

Chapter 13

A Chapter 13 filing is treated differently. In a Chapter 13, the debtor usually retains their assets, and a repayment plan is worked out through which creditors are paid some or all of what they are owed. As with a Chapter 7, you will meet with your lawyer and give them all the information needed to prepare you bankruptcy petition and schedules.

Once your lawyer files your petition and paperwork, the bankruptcy trustee will approve a repayment plan. The trustee will put a time frame on this, which will be no longer that 60 months (5 years), but can be as short as 36 months (three years). You will be expected to stay current on any existing obligations, such as a house or car payment if you have opted to keep them.

What about my Credit?

Filing for bankruptcy can remain on your credit for up to 10 years. However, once the bankruptcy is complete, many debtors find that the negative effects of bankruptcy begin to diminish quickly after the bankruptcy is completed. It may take a year or two, but most find that they are able to get a small credit card fairly soon after bankruptcy. That said, it is important not to repeat any spending mistakes that contributed the bankruptcy in the first place. However, it can be a good move towards building back your credit

Bankruptcy is a viable solution for those experience unmanageable financial turmoil. Speak with an experienced bankruptcy lawyer from the Law Offices of Paul M. Allen for more information. Our office has helped hundreds ands of clients stop repossessions, wage garnishments and more. Get back on the road to financial stability and call our office today. We will provide your will legal guidance as well as a free consultation. We have three offices to serve you, Glendale (818) 552-4500, Cerritos (562) 865-4480 and West Covina (626) 262-4446.

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Atty. Paul M. Allen is a member of the highly respected National Association of Consumer Bankruptcy Attorneys and an active member of the State Bar of California. His offices are located at 520 E. Wilson Ave., Suite 110, Glendale, CA 91206, and 17215 Studebaker Rd., Suite 380, Cerritos, CA 90703, with telephone numbers (818) 552-4500; (562) 865-4480; and (866) 903-4522. He also has offices at 2640 E. Garvey Ave., Suite 104, West Covina 91791, with tel. no. (626) 262-4446.

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(This article is for information purposes only, and does not necessary reflect the company’s opinions and views on general issues. We make no warranty, prediction nor representation, nor do we assume any legal liability for the completeness of any information and its effect on any case. Each case is different and results depend on the facts of each case. Consult with and retain counsel of your own choice if you need legal advice.) ■

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