Chapter 7

Chapter 7 bankruptcy clears out most types of debt and gives you a brand new start.  The bankruptcy laws have recently been amended to make it harder to qualify for this type of assistance, most people in debt that are considering bankruptcy are still able to start over by filing a chapter 7.

When you file a chapter 7, your creditors will be notified of your case and all collection activity will be stopped.  To find out whether your assets are subject to liquidation, a bankruptcy trustee is assigned to your case. You will have to go to a hearing with the Trustee so you can answer questions while under oath.  A couple months after the hearing, the judge will enter an order to discharge any debts that are dischargeable and your case will then be closed.  There are a few types of debt that are not able to be wiped out such as governement loans, student loans, fines and some taxes.

Just like a Chapter 13, the Chapter 7 process can be confusing.  It’s important that you consult with an experienced attorney to make sure you follow all guidelines of the federal bankruptcy code.  Your attorney will analyze your eligibility for a chapter 7 bankruptcy and tell you if any of your assets will be subject to liquidation and figure out if any of your financial transactions made recently will interupt your case.  The timing of your case can make a huge difference in saving you thousands of dollars.  When your case is filed, an experienced attorney will take over and communicate with your creditors, the trustee and the government attorneys who will be reviewing your case.