Chapter 7

The purpose of bankruptcy is to allow individuals deeply in debt to obtain a fresh start. When serious and sometimes unavoidable circumstances result in insurmountable debt issues, bankruptcy protection can be the answer.
There are many reasons that individuals simply cannot pay their debts. Illnesses, loss of job, divorce, bad money management, or just bad luck are just a few of the circumstances that can occur. Eligibility for Chapter 7 relief is limited.

Bamberger Law will determine if you are eligible for Chapter 7 based on your income and several other factors. If you are not eligible for Chapter 7, you may be eligible for Chapter 13 relief.

How It Works

First, if you are contemplating the filing of a Chapter 7 petition you should visit a bankruptcy attorney. Your attorney will confirm that you are eligible for Chapter 7 and that Chapter 7 represents the best approach based on your issues.

Then you will be required to provide certain documents and information to your attorney, and undergo credit counseling, which can be accomplished online. Your attorney will use this information to prepare a series of documents that list in detail your assets and liabilities, income and expenses which will be filed with the court and served on creditors.

Automatic Stay

From the moment your case is filed, creditors can no longer attempt to collect debts by any means. This rule, called the automatic stay, provides much needed relief to the debtor.

Meeting of Creditors

The debtor must then attend a “meeting of creditors” before a bankruptcy trustee. The trustee is a court officer assigned to administer the assets and pay the debts according to the rules set forth in the bankruptcy code. At the meeting of creditors, the trustee asks a series of simple questions designed to ensure that there are no irregularities that could be a sign of bankruptcy fraud, and asks about assets that might be available to pay creditors some of what they are owed. In the majority of cases, neither is found, and the meeting is generally completed in as little as 10 minutes.

Discharge

After the trustee has administered the case, arrangements are made to sell non-exempt assets in order to pay off creditors. Once this process is completed, any remaining unsecured debts will be discharged and the debts are extinguished forever. With respect to some debts like certain taxes and student loans, there are limitations on discharge, so these debts may survive bankruptcy. However, the discharge of your other debts will free up funds that can be used to satisfy these debts, so even if you have non-dischargeable debts, Chapter 7 may still be a good option for you.

Chapter 7 can be a great way to begin again, and regain your peace of mind. A reputable bankruptcy attorney should be retained to help with the process.

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