By now, you probably know the benefits of filing for Chapter 7 bankruptcy. Among them is the relative speed with which you can receive a discharge. The sooner your bankruptcy closes with a discharge, the sooner you can start fresh financially. But how long does Chapter 7 bankruptcy take, from filing to discharge?
The general rule is that Chapter 7 cases take four to six months to complete. A Chapter 7 case free of any issues will take about four months. However, a Chapter 7 case tied up in litigation could take up to a year.
6 Things That Can Make Chapter 7 Bankruptcy Take Longer
Exactly how long your bankruptcy case takes will largely depend on the types of problems that might arise. Below are six common situations that could extend the length of your Chapter 7 bankruptcy:
1. You Do Not Provide Information When You Should
Your bankruptcy will take longer if you don’t provide documents the bankruptcy trustee requests by a certain time. For example, you have 14 days after filing to submit supporting documentation if you didn’t file them with the petition. These documents list your assets, debts, expenses, income, and other financial information. Your case will be delayed until you provide this information.
Similarly, the trustee will not conclude your meeting of creditors if you fail to produce requested documents on time. They will do so by rescheduling the meeting to another time when you can answer questions about the requested information. This will prolong your bankruptcy by the amount of time your meeting of creditors is delayed.
2. A Creditor Has Questions or Objects
In a Chapter 7 bankruptcy, creditors can object to your bankruptcy exemptions within 30 days of your meeting of creditors. They have 60 days after your meeting of creditors to object to the court’s discharge of debts. If a creditor raises objections, your bankruptcy will be delayed until the dispute is resolved.
Your bankruptcy can also take longer if a creditor shows up to your meeting of creditors to ask you questions. Creditors are typically allowed ten minutes of time during a meeting of creditors to examine you. If they cannot question you fully within that time, your meeting of creditors could be rescheduled. These delays will result in a longer bankruptcy process, especially for complicated cases and those involving accusations of fraud.
3. You Have Property That the Trustee Will Sell
Your bankruptcy case will stay open until all your non-exempt property is sold to settle debts with creditors. If an issue arises with your property, you may still receive a discharge. However, your bankruptcy case will remain open until the issue is addressed. The delay in closure depends on how complicated it is to sell the property and what type of property it is. Your bankruptcy will be delayed longer if you have real estate that will take longer to sell.
4. You Are Involved in Litigation
You may end up in litigation before the bankruptcy court if the trustee or your creditors dispute your case. For example, your creditor could file a lawsuit to deem a debt non-dischargeable so that it must be paid. They could also object to your bankruptcy or assert you filed for fraudulent reasons. If this is the case, your discharge will be delayed until the matter is resolved. Count on adding six months to a year of time to your bankruptcy.
5. You Have Student Loan Debt You Want Discharged
Discharging student loan debt through Chapter 7 bankruptcy requires filing a complaint asserting undue hardship in repaying the debt. To resolve the suit, you will have to negotiate a settlement with your loan provider or go to trial. This can cause your bankruptcy to be delayed by more than a year.
6. You Do Not Take the Required Financial Education Course
A prerequisite to receiving a bankruptcy discharge is to participate in a personal financial management course. After you have taken it, you will be given a certificate of completion that you must file with the court. Your bankruptcy could be delayed for as long as it takes for you to take the course. If you wait too long, you risk dismissal of your bankruptcy case without receiving the discharge you sought.
Talk to a North Charleston Bankruptcy Attorney Today
Before deciding to file bankruptcy, be sure to first talk to an experienced bankruptcy attorney. We can help you understand the bankruptcy process and make sure you avoid needless delays. Contact Steadman Law Firm, P.A. to learn more.