How long does it take to complete a Chapter 7 bankruptcy?

On Behalf of | Aug 4, 2023 | Chapter 7

Individuals with significant personal debt and average or below-average income given their household size may qualify for Chapter 7 bankruptcy. A Chapter 7 filing is one of the fastest and most effective forms of debt relief available. The same day that someone initially files, the courts will give them the protection of an automatic stay, which will prevent creditors from continuing collection activity or taking them to court.

There will be several subsequent steps that must be taken, including creditor meetings and mandatory educational courses for the party filing. If the bankruptcy filing is successful, the courts will discharge the remaining balance that someone owes on their qualifying unsecured debts. How long will those pursuing a Chapter 7 bankruptcy typically need to wait after filing their initial paperwork before they can receive that discharge?

Chapter 7 filings often take several months to complete

The timeline for a Chapter 7 bankruptcy can be very different depending on the circumstances. The current volume of cases going through the courts, the number of creditors involved and even the responses of individual creditors can influence the timeline for a Chapter 7 bankruptcy filing.

In a situation with minimal challenges and limited court congestion, someone could potentially discharge the remaining balance on their unsecured debts as soon as 60 days after their initial filing. However, the full Chapter 7 process can take as long as 100 days, sometimes even longer than that, depending on the pushback from creditors and the number of cases currently requiring the attention of the local courts.

The date of the discharge will ultimately determine how long the record of the bankruptcy shows up on someone’s credit report. It usually takes 10 years from the date of the final discharge for the record of someone’s bankruptcy to completely come off of their credit report. Thankfully, many people can start rebuilding their credit and qualifying for new lines of credit well before reaching that point.

The timing of a bankruptcy filing can be of the utmost importance for an individual, as it will impact everything from creditor collection efforts to their future financial endeavors. Learning more about what to expect during the bankruptcy process may help people make truly informed choices about their rights and options under the law.