Bankruptcy: How Long Does a Case Take?
If you’re considering filing for bankruptcy in Michigan, one of your main concerns is probably how long the process will take. The answer depends on several factors, including the type of bankruptcy you file, the complexity of your case, and how quickly you can provide the required information and documentation.
Chapter 7 Bankruptcy Timeline in Michigan
Chapter 7 bankruptcy is often referred to as a “fresh start” bankruptcy because it typically involves zero payments to your creditors, with your general unsecured debts being discharged. The process typically takes around three to six months in Michigan, but it can be longer if your case is complicated or if there are any objections from your creditors or the trustee that would result in additional hearings or involvement in negotiations.
Here is a general timeline of the Chapter 7 bankruptcy process in Michigan:
- Initial Consultation with Lawyer: We have a meet and greet where we go over your assets, debts, income and expenses to determine the best path for you.
- Pre-filing Credit Counseling: Before you can file for Chapter 7 bankruptcy, you must complete a credit counseling course from an approved agency. This typically takes one to two hours and can be done online or over the phone.
- Filing Bankruptcy Petition: You must file a bankruptcy petition with the court, along with various schedules and forms that detail your income, expenses, assets, and debts. These will be documents that we complete on your behalf, based on documents and information you you provide to us. After these documents are drafted, we will review these together for accuracy and completeness, and sign them before they are filed with the Court. Once filed, the automatic stay goes into effect, which stops most collection actions against you.
- Meeting of Creditors: About a month after you file your petition, you must attend a meeting of creditors, also called a 341 hearing. The trustee assigned to your case will preside over the meeting, and your creditors may attend to ask you questions about your finances. This meeting usually lasts about 10-15 minutes.
- Provide any Additional Documents (if requested): During the hearing the trustee may ask for additional documents. These are typical bank records, copies of checks, or proof of purchases or sales.
- Post-filing Counseling Course & Filing Fees: After you have provided everything the trustee needs, the last thing is to make sure you took your second course, and paid any outstanding filing fees to the court.
Chapter 13 Bankruptcy Timeline in Michigan
Chapter 13 bankruptcy is a reorganization bankruptcy that allows you to repay your debts over a period of three to five years. The process is more complex and takes longer than Chapter 7 bankruptcy, but it can be a good option if you have non-exempt assets you want to keep or if you’re behind on your mortgage or car payments.
Here is a general timeline of the Chapter 13 bankruptcy process in Michigan:
- Pre-filing Credit Counseling: Like with Chapter 7 bankruptcy, you must complete a credit counseling course before you can file for Chapter 13 bankruptcy.
- Filing Bankruptcy Petition: You must file a bankruptcy petition with the court, along with a repayment plan that details how you will repay your debts over three to five years. These will be documents that we complete on your behalf, based on documents and information you you provide to us. After these documents are drafted, we will review these together for accuracy and completeness, and sign them before they are filed with the Court. The automatic stay goes into effect when you file.
- Meeting of Creditors: About a month after you file your petition, you must attend a meeting of creditors, presided over by the trustee assigned to your case.
- Confirmation Hearing: About two to three months after you file your petition, you will attend a confirmation hearing, where the court will approve or deny your repayment plan.
- Repayment Plan and Discharge: If your repayment plan is approved, you must make payments to the trustee over three to five years. After you complete your payments, you should receive a discharge order from the court, which eliminates your dischargeable debts.
The length of a Michigan bankruptcy case depends on several factors, including the type of bankruptcy you file, the complexity of your case, and how quickly you can provide the required information and documentation.