In Chapter 7 bankruptcy, the bankruptcy trustee cancels many (or all) of your debts. This is the most common type of bankruptcy for an individual. Chapter 7 bankruptcy, also called "straight" or "liquidation" bankruptcy, is so named because the law is contained in Chapter 7 of the federal Bankruptcy Code. There is no repayment plan made with Chapter 7 and you usually get your discharge in 3 months. we guide you through the entire process until you receive your discharge paperwork. Our goal is to help make you debt free! We include counseling classes and credit reports in all of our bankruptcy packages.
Who can file
You won't be able to use Chapter 7 bankruptcy if you already received a bankruptcy discharge in the last six to eight years (depending which type of bankruptcy you filed) or if, based on your income, expenses, and debt burden, you could feasibly complete a Chapter 13 repayment plan.
Filing for Chapter 7 bankruptcy puts into effect something called the "automatic stay." The automatic stay immediately stops most creditors from trying to collect what you owe them. So, at least temporarily, creditors cannot legally grab ("garnish") your wages, empty your bank account, go after your car, house, or other property, or cut off your utility service.
The Creditor's Meeting
A week or two after you file, you (and all the creditors you list in your bankruptcy papers) will receive a notice that a creditor's meeting has been scheduled. The bankruptcy trustee runs the meeting and, after swearing you in, may ask you questions about your bankruptcy and the papers you filed. In the vast majority of Chapter 7 bankruptcies, this is the debtor's only visit to the courthouse.
At the end of the bankruptcy process, all of your debts are wiped out (discharged) by the court, except:
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Chapter 13 bankruptcy isn't for everyone. Here are a few requirements you should know upfront.
Filing and completing a Chapter 13 bankruptcy case is far more complicated than Chapter 7 bankruptcy. Here’s a snapshot of the process:
Mandatory Courses and Filing fees, the repayment plan typically covers these debts.
he central part of your Chapter 13 case is the repayment plan that you’ll propose to your creditors and the court. Amongst other things, the plan must take into account each of your debts. You’ll use either the official plan form or your court’s local form, depending on where you file.
Your creditors and the bankruptcy trustee will have an opportunity to object to your plan. If you’re able to make changes to everyone’s satisfaction, the court will likely approve (confirm) your plan at the confirmation hearing. You won’t wait until plan confirmation to start paying your monthly payment, however. Your payments will begin the month after you file.
Call us today so we can guide you through this complex matter. A small mistake can be detrimental in bankruptcy.