How Long Does Bankruptcy Last?

Bankruptcy usually lasts 3 years and 1 day of application submission to the AFSA, and 3 years 1 day after you submit your statement of affairs in the case of creditor’s petition. This is called ‘Discharge from Bankruptcy’, but if the trustee thinks that you have not cooperated as much as you should have, then the trustee can lodge a further application called ‘Objection to Discharge from Bankruptcy’. If the trustee’s objection is deemed to be on valid grounds, the bankruptcy can be extended to 5 years or even to 8 years in some cases. You could also apply to get your bankruptcy annulled. There are three ways to annul your bankruptcy.

Pay Debts in Full

All the debts including interest, realization charges and the trustee’s fees and expenses are paid in full. This can be done by selling off sufficient assets or being able to gather funds to pay off all loans, or a third party paying off on the bankrupt party’s behalf.

Offer of Composition

The creditors agree to accept a certain amount which would be less than the repayment in its full sum. The agreement could also be based upon absorbing some assets which was not available during bankruptcy or which was previously unacquired.

Court Decision

You need to prove to the court that the petition should not have been lodged or you should not have been made bankrupt on the creditor’s petition. One the court is satisfied that the bankrupt party is not insolvent, it will consider annulling the bankruptcy altogether.