Q: How long bankruptcy?

Q: How long bankruptcy?

A: How long bankruptcy? It’s really a two-part question, requiring a two-part answer. The bankruptcy proceeding itself, according to the Bankruptcy Court website can take a few months to a few years. The U.S. Department of Justice says on its bankruptcy information pages that the two Chapters of the Bankruptcy Code most often used by consumers are Chapter 7 and Chapter 13.

Under Chapter 7, according to the DOJ, “Chapter 7 bankruptcy is a liquidation proceeding available to consumers and businesses. Those assets of a debtor that are not exempt from creditors are collected and liquidated (reduced to money), and the proceeds are distributed to creditors. A consumer debtor receives a complete discharge from debt under Chapter 7, except for certain debts that are prohibited from discharge by the Bankruptcy Code.”

Under Chapter 13, according to the DOJ, “Chapter 13, often called wage-earner bankruptcy, is used primarily by individual consumers to reorganize their financial affairs under a repayment plan that must be completed within three or five years. To be eligible for Chapter 13 relief, a consumer must have regular income and may not have more than a certain amount of debt, as set forth in the Bankruptcy Code.”

So according to the DOJ, Chapter 7 takes a few months and Chapter 13 takes three to five years. The second part to this question–how long bankruptcy?–is somewhat more problematic. Bankruptcy can continue to follow you and your credit report for from seven to 10 years. That’s right, the details of your bankruptcy will stay on your credit report for up to 10 years. After that, it disappears. If you have worked diligently to put your past credit problems behind you and you have paid all of your bills on time and developed new credit relationships over the 10 years, you score should start to improve dramatically. You may think someone has blown to “all-clear” siren, but they have not. When you go to apply for any home loan or car loan, chances are that there will be a question on the application along the lines of “Have you ever declared bankruptcy?” In this way, it can continue to be part of your life.
Bankruptcy Chapters for Consumers

Chapter 7 bankruptcy is a liquidation proceeding available to consumers and businesses. Those assets of a debtor that are not exempt from creditors are collected and liquidated (reduced to money), and the proceeds are distributed to creditors. A consumer debtor receives a complete discharge from debt under Chapter 7, except for certain debts that are prohibited from discharge by the Bankruptcy Code

Chapter 13, often called wage-earner bankruptcy, is used primarily by individual consumers to reorganize their financial affairs under a repayment plan that must be completed within three or five years. To be eligible for Chapter 13 relief, a consumer must have regular income and may not have more than a certain amount of debt, as set forth in the Bankruptcy Code.

Can You File for Bankruptcy without a Lawyer?

The www.uscourts.gov website has a section on it titled “Filing Without an Attorney.” According to the website, “Individuals can file bankruptcy without an attorney, which is called filing pro se. However, seeking the advice of a qualified attorney is strongly recommended because bankruptcy has long-term financial and legal outcomes.”

Let us remind you of an old saying:

“He who represents himself has a fool for a client.”

The website goes on to say that “filing personal bankruptcy under Chapter 7 or Chapter 13 takes careful preparation and understanding of legal issues. Misunderstandings of the law or making mistakes in the process can affect your rights. Court employees and bankruptcy judges are prohibited by law from offering legal advice.”

There are so many ways that a good bankruptcy lawyer can help you through these difficult times:

Advise you on whether to file a bankruptcy petition.
Advise you under which chapter to file.
Advise you on whether your debts can be discharged.
Advise you on whether or not you will be able to keep your home, car, or other property after you file.
Advise you of the tax consequences of filing.
Advise you on whether you should continue to pay creditors.
Explain bankruptcy law and procedures to you.
Help you complete and file forms.
Assist you with most aspects of your bankruptcy case.
Get legal help here:

American Bar Association’s Legal Help

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