Chapter 7 bankruptcy is often used as a last resort to help with monthly expenses. This type of bankruptcy can help stop foreclosures and help wipe out debts, including many types of unsecured debts. For anyone who is far behind on their bills and can no longer afford monthly payments and/or living expenses, filing for liquidation is one way to clear away debts.
- Credit Card Debts
- Unsecured Loans
- Medical Bills
- Judgments / Law Suits
When filing for Chapter 7 or Chapter 13 Bankruptcy, everyone is required to list all of their assets. The bankruptcy laws protect your assets from creditors. There is a limit on the amount protected, but most people fall well below that limit. This means that you can wipe away your debt and still keep your property. You might have property that is collateral like a mortage on your house or car, but in most cases, can keep and continue to pay on those items.
Here is a list of some of the property that is protected when filing Chapter 7 Bankruptcy:
- Equity in your home
- Equity in a vehicle
- A burial plot
- Personal property (Clothing, jewelry, books and pets)
- Health Aids
- Crops and animals
- Household items including appliances, furniture, etc.
- Tools, books and implements required for your employment
- Child support payments
- Most life insurance policies
- Retirement accounts
- Wrongful death awards and personal injury awards
- Public Assistance, Social Security, Disability Benefits, Veterans' Benefits and Unemployment Compensation Benefits
After meeting with one of our lawyers, you will list all of your assets, debts, current income and other information that is necessary to complete the paperwork. While filing the paperwork you will determine whether there are any debts you wish to reaffirm (meaning you wish to continue to pay that debt rather than having it wiped away). You must complete an instruction class refered to as "Credit Counseling". You are able to take this class online or over the phone and it only takes a few moments to complete this class.
Once everything is signed and you've completed the Credit Counseling class, we will begin the filing process for your case.
Everything is electronically filed in bankruptcy cases. The computer will automatically assign a trustee and a bankruptcy judge to your case after it is filed. After filing, you must attend one meeting with your trustee that you've been assigned. This meeting is not only an opportunity for your trustee to ask you questions about your case, but is is also an opportunity for creditiors to question you. In most cases creditors don't attend the meeting or ask questions unless their is some kind of complicated debt or issue pending in the case.
After the meeting is held Creditors and the trustee have a time period during which they can file objections to your discharge, but after that period has past the judge will enter you discharge order. This means your debts are wiped away.
There are other requirements associated with filing bankruptcy, this is a simplified version of how a Chapter 7 bankruptcy case proceeds.