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How Long Does Bankruptcy Take?

How long the bankruptcy process takes can vary greatly from case to case and chapter to chapter. In some Chapter 7 cases, the petitioner can receive a discharge in as little as two months. Depending on what assets are present, the case may continue after the court issues a discharge as property is sold to pay creditors. Objections from creditors can also increase the time necessary for completing a Chapter 7 case.

Chapter 13 bankruptcy can take substantially longer than Chapter 7. This is because Chapter 13 requires the debtor to complete a court-supervised payment plan before receiving a discharge. The case remains open and active while the payment plan is in effect. Chapter 13 plans usually last between three and five years. They cannot run longer than five years in most cases. Once the debtor has made the payments required under the plan for the established time period, the court may issue a discharge.

Chapter 11 is substantially more complex than both Chapter 7 and Chapter 13. It also has the potential to take the longest of the three, with some Chapter 11 cases stretching over years. This, however, is not always the case. When the debtor, creditors and trustee are able to work together Chapter 11 can actually move fairly quickly. Discharge usually occurs fast if the debtor promptly submits a reorganization plan, the creditors approve it and the court confirms it.

The debtor has 120 days during which to submit such a plan. If the debtor submits a plan promptly and the creditors approve, the entire process may be resolved within only months of the petition being filed. Unfortunately, if the debtor does not submit a workable plan or if the creditors cannot agree, the process can last substantially longer.

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