How Does the Bankruptcy Process Work?
Bankruptcy's laws and the bankruptcy process itself have been intimidating and confusing Americans for a long time. This was true before the new bankruptcy laws took effect in October of 2005, and it is still true today.
At Prescott & Pearson, P.A., we have handled over 70,000 bankruptcy petitions in Minnesota and can provide you with the answers and information you need to decide whether bankruptcy is your best option. More importantly, if you decide to work with us, you'll benefit not only from our extensive experience and knowledge of the law — but also from the decades we've spent earning the trust of the bankruptcy judges, trustees and creditors' attorneys who practice in this state.
The first step toward a fresh start? Call or contact our Twin Cities area law offices for a free consultation today.
How It Works
The first thing to know (whether you're filing under Chapter 7 or Chapter 13) is that the smartest course of action is to meet with a bankruptcy lawyer as soon as you think bankruptcy may be a real possibility. This can help you make the most of the opportunities the bankruptcy process provides and help you to avoid making mistakes that could get your petition dismissed.
The Chapter 7 bankruptcy process can be completed in as little as three to four months (60 days after the meeting with your creditors). The key stages of this timeline are highlighted below:
- The bankruptcy petition gets filed, a trustee is appointed and the automatic stay protecting you from harassment, wage garnishment and foreclosure goes into effect (this is day one)
- Attend one financial management counseling session ( soon after filing and before discharge)
- Your creditors are notified (usually within 7 days)
- You must attend a creditors' meeting, also known as a 341 meeting, which usually happens 30 to 45 days after your petition is filed (creditors are invited but rarely attend)
- After the creditors' meeting, most creditors have 60 days to file objections
If a creditor does not object within the 60-day window the debt will be discharged. The Chapter 13 timeline is essentially the same as the Chapter 7 timeline but will not be completed and discharged until the end of your three- or five-year repayment plan.
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Minneapolis-St. Paul: 651-968-8096 / Statewide Toll-Free: 888-366-0827
For answers to any other questions about bankruptcy in general, or about your specific situation and concerns — don't hesitate to call or contact our lawyers in the Twin Cities area for a free consultation.
