In most bankruptcy cases, the main goal is to get a “discharge.” The discharge is a permanent court order that prevents your creditors from holding you personally liable for any discharged debts. That means no collection calls, no lawsuits, and no garnishments.
So how long does it take to get a discharge? The answer depends upon which type of bankruptcy you choose.
Chapter 7: The Fast Track
In a Chapter 7 case, you’ll probably receive your discharge within 4 months of filing your bankruptcy petition. But this doesn’t mean you have to wait for the creditors and debt collectors to get off your back. During the time period between filing and discharge, the “automatic stay” provision of the Bankruptcy Code gives you immediate debt relief by preventing your creditors from starting or continuing collection efforts while your case is pending.
Chapter 13: Worth the Wait
With Chapter 13 bankruptcy, you pay back at least some of your debt with a “plan” that lasts from 3 to 5 years. Some people with higher incomes need to file a Chapter 13 because they don’t qualify for Chapter 7. Other folks choose Chapter 13 bankruptcy to accomplish specific goals like catching up on a delinquent mortgage and saving a home, or paying off tax debt that wouldn’t be wiped out by the discharge.
A Chapter 13 discharge is entered after you make your last plan payment and some final paperwork is filed with the court. Just like in Chapter 7, the automatic stay protects you from creditors while your case is working its way toward discharge. So even though finishing a Chapter 13 takes some time, your debt relief still begins as soon as your petition is filed with the court.
It’s About Time… to Get Out of Debt
If you’re considering bankruptcy as a way of getting out of debt, you’ve probably got lots of questions. To get them answered, all you have to do is get in touch with me and set up a free consultation at my Indianapolis office.