It is hard to say exactly because there are so many unpredictable variable factors and uncertainties that are outside of our control, such as how quickly the court processes the case, how quickly the trustee files their no asset report, how quickly it gets closed, but a typical Chapter 7, start to finish, is about five months in the Los Angeles and Orange County California Courts. Chapter 13 takes five years, in most cases unless the debtor pays back all their creditors one hundred percent before the five years is up. Converting from a Chapter 7 to a Chapter 13 (or vice versa) can add time, but that is not common.
Emotional Impact Of Filing For A Bankruptcy
For most clients, it feels as the world has been lifted off their shoulders. They have been struggling with the burden of debt for so long before they finally filed bankruptcy. They have had the collection calls, they have had creditors making unrealistic, unreasonable demands on them for so long, scaring them, intimidating them, berating them, harassing them for so long that filing bankruptcy and getting those creditors off their back is a tremendous relief. It is the resolution of a tremendous negative situation in their life so they can get a fresh start and just move forward again.
So, typically clients’ whole outlook changes, they become much more positive, they have now eliminated the single largest source of stress that they have probably ever had in their life. So, most clients, in fact, nearly all clients, flourish after a Chapter 7 bankruptcy because they have had the burden of debt eliminated and they are free to focus on other (more important) things in their life, such as their family, job, future and so the psychological impact is tremendously positive.
The impact and the benefit of bankruptcy that I have seen be the most dramatic is for individuals that work in industries where they are interacting with people a lot such as sales or marketing, or creative industries, because the stress and the burden of debt, it occupies so much of their mental capacity – worrying constantly, losing sleep, not being fresh, not being at their best, that for those people specifically that work in any kind of sales environment or any kind of creative environment, those people can really experience a significant improvement in their life because they are now free to not focus on the burdens of creditors and not focus on the stress that they have been feeling but rather be free to focus on what they’re good at instead, and that makes them much happier.
You know they have been living with this for so long, this stress and this burden for so long, that once that is gone, it is like they get their brain back, they get all their abilities back, they get all their focus and energy back and they are free to go to what they do best, which is to create things or sell things or be effective at their job and be effective with their families. It takes away from family time because if you are struggling with that burden of debt and being overwhelmed by creditors calling on the phone constantly, making threats, not knowing if what the creditors said is real or it is just harassment or they are just trying to get you to pay money.
Once all that is gone, the family life improves tremendously, interactions with friends, social life and especially the work life improves. I have seen so many clients that were struggling financially before bankruptcy but then get a fresh start through bankruptcy, to get rid of their debts, and then once they have no debt, their life improves significantly and they do great things in the workplace, with their business, with their sales, with their creativity. So bankruptcy is oftentimes a key for certain individuals becoming successful because it removes that tremendous anchor that has been holding them back.
For more information on Timeframe Of Bankruptcy Resolution, a free initial consultation is your next best step.