How Long Does the Bankruptcy Process Take in Texas?

If you’re considering bankruptcy here in Texas, you’ll want to know not only all the details but whether this is the best choice for you and your family. Talk with a bankruptcy attorney in Dallas, TX as soon as possible so you know where you stand and what to expect.

How Long Does the Bankruptcy Process Take in Texas?

Preparation Step

The first step is simply preparing to make your bankruptcy petition. How quickly you make it through this step will depend on whether you’re organized and whether you have a lawyer to help you dot all the i’s and cross all the t’s. You could be looking at several days to several weeks for this initial step, depending on those two factors.

You will need to show proof of your income, bank statements, billing statements, investment statements, tax statements, and your ID and Social Security card. If you have all of these things gathered in advance, things will go more quickly. Bear in mind that you will also have to provide proof that you have taken a credit counseling course, so if you have not done that already, this should be added to the timeline.

You may also need valuations of your home or other property and car, photos of any collections you may have or of any special assets, and photos of any property damage and repair costs you’ve sustained. Once all the documents and photos have been gathered, you’ll work with your bankruptcy lawyer to prepare a bankruptcy petition. You will use this to present the court with an accurate view of your total financial situation. The court will take a look at your property and its value and then consider everything that you owe, your regular income, and all your regular expenses.

Meeting With Creditors

Once you have submitted everything and filed your petition, you will have to meet with your creditors. This is generally a short meeting, and the purpose is to verify all your personal and financial information.

Anyone to whom you are in debt is able to attend this meeting, but in common practice, most creditors do not attend. If there are no complications here, and if you have filed everything correctly, this may be the only hearing you have to attend. Everything will go much more smoothly if you have a lawyer helping you to ensure that everything is done right the first time.

Chapter 7 and Chapter 13 Differences

There are some differences in the timeline at this point, depending on what type of bankruptcy you’re filing for. In general, Chapter 7 bankruptcy is more straightforward and simple. However, it is more difficult to qualify for. In Chapter 7 bankruptcy, you are essentially saying that you simply cannot pay your debts. Once everything is figured, and all your paperwork has been submitted correctly, you’re looking at something like six months before the whole process is done.

Chapter 13 bankruptcy takes longer, but it is easier to qualify for. With Chapter 13 bankruptcy, you are setting up a payment schedule to deal with some of your debt, so the bankruptcy process will not be over until you have finished all the repayments. This means it can take months to years for the process to be completed.

Common Delays

It is common for there to be delays in a bankruptcy proceeding, and nearly all of these delays are caused by some kind of paperwork issue. The most common delays are caused by not following the schedules that have been set by the court and meeting all the deadlines; misrepresenting finances in the petition (which can even be done accidentally if you’re unfamiliar with the forms and terms); forgetting to include important information in your supporting documentation; a dispute by one of your creditors about your debt; or failing to get the credit counseling that’s required to move forward.

You can avoid unnecessary delays by working with a qualified attorney. If you choose to go it alone, or if you work with an attorney who doesn’t have specific experience in bankruptcy law, the chances of having some kind of issue in your paperwork or in your submission generally is very high.

FAQs About Bankruptcy

Should I Choose Chapter 7 or Chapter 13 Bankruptcy?

In the end, this question may not be up to you. Chapter 7 bankruptcy is difficult to qualify for. You will have to prove that your income is low enough relative to your expenses that you cannot reasonably be expected to pay off your debts. Either way, you’ll want to talk with a lawyer who can give you more specific guidance based on your circumstances.

Will I Lose Everything?

No! The purpose of bankruptcy is not just to make sure that creditors are paid but to get the bankrupt individual back on their feet and functioning as a contributing member of society. The state is interested in allowing you to keep many things without which you would not be able to continue contributing.

For example, in most cases in Texas, you’ll be able to keep your primary residence and up to 10 acres of property if you live in a town or city and up to 100 acres of property if you live in a rural area. You are also generally able to keep your insurance, retirement accounts, one vehicle per licensed driver in your home, and lots of your personal property, such as furniture, clothing, and home goods.

How Does Bankruptcy Affect My Credit?

While bankruptcy does provide a way to get a fresh start, it will have a negative effect on your credit. You’ll likely see a drop of 100 to 200 points, and the bankruptcy itself stays on your credit report for seven to ten years. You’ll be getting rid of your debt, or at least reducing it, but you’ll also find it harder to get car loans, credit cards, or mortgage loans for years to come.

Should I Declare Bankruptcy?

Only a qualified and experienced lawyer, with access to the details of your situation, can help you make this decision. There are pros and cons to it, but in most cases this is a “last resort” decision. Only if you are very sure you are unable to pay back your debts would it be advisable to consider bankruptcy.

What Are the Alternatives?

​Don’t think that bankruptcy is the only way out: it’s not, and for some people, it’s not the ​right move. ​In many cases, it’s possible to agree to a repayment plan with creditors that lets you pay off ​debt in smaller amounts or ​negotiate your debt lower. If you file for bankruptcy, most of your creditors will get very little, so ​they are usually incentivized to work with you. Your lawyer can talk with your creditors on your behalf and may be able to negotiate an agreement.

Talk With a Bankruptcy Attorney in Dallas, TX Today

Bankruptcy is the right decision for some and the wrong decision for others. It can also be a ​time-consuming process if you aren’t aware of everything that needs to be done and how to do it. For experienced help in Dallas, Plano, Sherman, and nearby areas, contact the Pelley Law Office today.

Contact Our Texas Bankruptcy Law Firm For Help Today

If you’re facing bankruptcy in Texas, we’re here to help. Contact the experienced bankruptcy lawyers at Pelley Law Office, L.L.P., today to schedule a free consultation.

We proudly serve Plano, Dallas, Sherman, and the surrounding areas.

Pelley Law Office L.L.P. – Plano Office
Address: 1312 14th St, Plano, TX 75074
Phone: (972) 608-0335
Hours: 24/7

Our firm is located near you. Find us with our GeoCoordinates: 33.0180322,-96.6952916,863

Pelley Law Office L.L.P. – Sherman Office

Address: 905 N Travis St, Sherman, TX 75090
Phone: (903) 813-4778
Hours: 24/7

Our firm is located near you. Find us with our GeoCoordinates: 33.6445846,-96.6113141,857