Bankruptcy in Missouri: How Long You Can Expect the Process to Take?

Bankruptcy is a legal process that allows individuals or businesses to discharge or restructure their debts. It can be a difficult decision to make, but sometimes it is the best option to regain financial stability. If you are considering bankruptcy, it is important to understand the process and how long it can take.

Learn the types of bankruptcy available in Missouri, the process of filing for bankruptcy, the factors that can affect the duration of bankruptcy, and the timeline for Chapter 7 and Chapter 13 bankruptcy in Missouri.

What is Bankruptcy in Missouri?

Bankruptcy is a legal process that is governed by federal law, but it is implemented by the courts in each state. In Missouri, bankruptcy is filed in the United States Bankruptcy Court for the Western District of Missouri or the Eastern District of Missouri. There are two main types of bankruptcy available in Missouri: Chapter 7 and Chapter 13.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy is also known as liquidation bankruptcy. It allows debtors to discharge most of their debts, but they may have to sell some of their assets to repay creditors.

Chapter 7 bankruptcy is a relatively quick process, but it still takes several months to complete. Here is a timeline of the process:

• Consult with a bankruptcy attorney
• Complete credit counseling
• File for bankruptcy
• Attend a meeting of creditors
• Attend a discharge hearing
• Receive a discharge of debts

Chapter 7 bankruptcy is available to individuals, partnerships, and corporations. It is designed for debtors who cannot afford to repay their debts and have few assets to sell. In Chapter 7 bankruptcy, a trustee is appointed to oversee the sale of non-exempt assets, which are used to repay creditors. Most unsecured debts, such as credit card debt and medical bills, are discharged in Chapter 7 bankruptcy.

Chapter 13 Bankruptcy

Chapter 13 bankruptcy, on the other hand, is also known as reorganization bankruptcy. It allows debtors to restructure their debts and pay them off over a period of three to five years.

Types of Bankruptcy in Missouri

Chapter 13 bankruptcy is a longer process, as the debtor must make monthly payments to the trustee for three to five years. Here is a timeline of the process:

• Consult with a bankruptcy attorney
• Complete credit counseling
• File for bankruptcy
• Attend a meeting of creditors
• Confirm the repayment plan
• Make monthly payments to the trustee
• Attend a discharge hearing
• Receive a discharge of debts

Chapter 13 bankruptcy is available to individuals with regular income. It is designed for debtors who want to keep their assets, such as a home or a car, but need to restructure their debts.

In Chapter 13 bankruptcy, the debtor proposes a repayment plan to the court, which outlines how they will repay their debts over a period of three to five years. The debtor makes monthly payments to a trustee, who distributes the funds to creditors.

The Process of Filing for Bankruptcy in Missouri

The process of filing for bankruptcy in Missouri can be complex, but it is important to follow the correct steps to ensure the process goes smoothly.

1. The first step is to consult with a bankruptcy attorney, who can advise you on the best course of action and help you prepare the necessary paperwork.
2. The next step is to complete credit counseling, which is required before filing for bankruptcy. This counseling is designed to help debtors understand their options and develop a plan to manage their debts.

• Once credit counseling is complete, the debtor can file for bankruptcy. They must submit a petition to the court, which includes information about their debts, assets, income, and expenses. They must also provide documentation, such as tax returns and bank statements, to support their petition.

How Long Does the Bankruptcy Process Take?

The duration of the bankruptcy process in Missouri depends on several factors, such as the type of bankruptcy, the complexity of the case, and the court's schedule.

• Chapter 7 bankruptcy takes about four to six months to complete.
• Chapter 13 bankruptcy takes three to five years.

Factors That Can Affect the Duration of Bankruptcy in Missouri

Several factors can affect the duration of bankruptcy in Missouri, such as

• Complexity of the case
• Debtor's cooperation
• Court's schedule.

For example, if the debtor has a lot of assets that need to be sold in Chapter 7 bankruptcy, the process may take longer. If the debtor fails to provide the necessary documentation or attend court hearings, the process may also be delayed.

A Cash Home Sale Can Help You Avoid Bankruptcy and Get Out of Your Mortgage

If you're facing financial difficulties and bankruptcy seems imminent, a cash home sale could be a potential lifeline. Selling your house for cash can provide a quick influx of funds, helping you pay off debts and potentially avoid bankruptcy.

If you're unable to keep up with your mortgage payments, selling your home to a cash buyer like Housemart can provide a way out. It offers a swift solution to get out from under your mortgage, freeing you from ongoing payments and possible foreclosure.

Remember, it's essential to consider all your options and seek advice from a financial advisor or legal professional when facing these challenges. A cash home sale can be a valuable tool in your financial recovery toolkit, offering a fresh start and a pathway to regaining your financial footing.

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