The Bankruptcy process is a much shorter process for individuals under Chapter 7 when compared to the other chapters in bankruptcy law. This is so because Chapter 7 Bankruptcy simply involves liquidation of assets. Individual bankruptcy under Chapter 13 will be a longer process due to the required repayment plan that must be completed.

Chapter 7 Bankruptcy requires an appointed trustee to view the debtor’s assets and determine whether they are exempt or not exempt from liquidation. The trustee then pays off the debtor’s debt with the money that is generated from the sales of all the debtor’s assets. The entire process is relatively short. It normally takes anywhere from three to six months to complete the entire Chapter 7 Bankruptcy process.

Individuals that file Chapter 13 Bankruptcy are forced to deal with a much longer process. Chapter 13 Bankruptcy requires the debtor to repay a portion or all of his or her debts in three to five years. Those debtor’s whose income is below their state’s average income level will be required to repay their creditors in three years, thus resulting in three years of the bankruptcy process. A debtor that qualifies for Chapter 13 Bankruptcy and has income greater than his or her state’s average income level will be required to repay creditors in five years. This results in five years of bankruptcy. Chapter 13 Bankruptcy will not last longer than five years.

Chapter 12 Bankruptcy, intended for family farmers and family fishermen is comparable to Chapter 13 in terms of process time. Family Farmers and family fishermen are required to pay installments to their creditors for three to five years. However, under Chapter 12, most individuals’ repayment plans last for over three years. Repayment plans that include 100 percent payment on child support and alimony are for over three years as well. If the repayment plan does not include 100 percent payment on child support and alimony, the debtor’s plan will last five years.

There are other situations that occur that can shorten or lengthen the bankruptcy process. When a debtor chooses to file for bankruptcy independently, it can be a daunting task and can result in dismissal. Hiring an attorney may help to speed some of the more difficult processes, however the required repayment plan periods will not be subject to change due to this.

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