How Long Does the Bankruptcy Process Take in Pennsylvania?
Filing for bankruptcy can allow you to discharge certain debts or restructure your debt. In Pennsylvania, individuals have the option to file for either Chapter 7 or Chapter 13 bankruptcy. The timeline for each varies drastically, with the Chapter 7 process taking four to six months and the Chapter 13 process taking three to five years to complete.
In this blog, our PA debt relief attorney provides an overview of both Chapter 7 and Chapter 13 filings and the federal exemptions.
Chapter 7 Bankruptcy
For lower-earning individuals, chapter 7 bankruptcy is typically the best option. In a Chapter 7 bankruptcy, a person is allowed to liquidate their assets and effectively pay off their creditors. Chapter 7 is recommended for anyone who is interested in “wiping the slate clean.” There is no debt limit, although you must be below the state’s median income to file (as of 2024, it is $57,919.) If an individual desires to pay off an exorbitant amount of debt quickly, our PA debt relief lawyer may recommend a Chapter 7 filing.
Chapter 13 Bankruptcy
If you earn a regular income and are looking to restructure your debt, then Chapter 13 bankruptcy is probably right for you. Coined a “wage earner’s plan,” a typical repayment plan lasts three to five years. If you are facing losing your home, a Chapter 13 filing will initiate an automatic stay, which will stop foreclosure proceedings in its tracks.
To qualify for Chapter 13 bankruptcy, you must have less than a total of $2.75 million in secured and unsecured debts. Individuals who are self-employed or operate an unincorporated business are also allowed to file under Chapter 13. However, individuals must receive credit counseling from an approved credit agency no more than 180 days before filing.
Federal Exemptions
When you file for bankruptcy, certain properties will be protected from creditors. If you are filing for bankruptcy in Pennsylvania, you have the choice of choosing between state or federal exemptions. Current federal exemptions are as follows for single filers:
- $27,900 in home equity (The current value of your house minus your mortgage or outstanding liens)
- $4,450 in vehicle equity
- $700 per item in household goods, up to $14,875
- $2,800 in tools of your trade and professional books
- $1,875 in jewelry
- Wildcard exemption of $1,475 (can be applied to any property you own)
- Up to $13,950 of any unused exemption in your home
How Can a Debt Relief Attorney Help Me?
If you are considering bankruptcy, you need a lawyer who can handle the entire process on your behalf. At Audi Law, PLLC, we will explain your rights regarding debt relief options so you can find the choice that works best for you. Our PA debt relief attorney has successfully negotiated with thousands of lenders to help individuals develop a repayment plan that works best for them.
Reach Out to Our PA Debt Relief Attorney Today
We understand the road to financial relief is never smoothly paved. At Audi Law, PLLC, our PA debt relief attorney, provides innovative services to individuals who are working to climb their way out of bankruptcy. To schedule a meeting with a PA debt relief attorney, contact us online or give us a call today.