Menu

Understanding What Bankruptcy Really Means


What To Expect From The Chapter 7 Bankruptcy Process

People paying for Chapter 7 bankruptcy attorney services will want to know what to expect from the process. Chapter 7 bankruptcy tends to run on a set of rails so you shouldn't run into a lot of surprises. A Chapter 7 bankruptcy attorney wants to ensure you meet the eligibility requirements and that the paperwork is right. It's usually a tightly scripted process, and you can expect these four things.

Liquidation

The big thing a bankruptcy attorney will want you to understand is Chapter 7 means liquidation. A court will order the sale of your non-exempt assets, and the proceeds of the sales will go equitably to your creditors. However, this doesn't mean the court will sell all of your earthly possessions. It's common for some individuals to claim exemptions on practical vehicles, clothes, furniture, and other everyday items. There may also be items the court doesn't want to or can't sell. Similarly, some states allow wildcard exemptions up to a certain cash value.

A Chapter 7 bankruptcy lawyer will want you to be aware that the court may sell seemingly non-extravagant items. If you have a $30,000 car, for example, a court-appointed trustee may sell the vehicle and give you part of the proceeds to downsize to a more practical vehicle.

Qualification

Anyone who makes less than half of their state's median income is likely to automatically qualify. If you don't meet that threshold, you'll have to prove to the court that your situation calls for Chapter 7 bankruptcy. It's always wise to retain Chapter 7 bankruptcy lawyer services during the process, but that's especially the case if you need to document income, expenses, and outstanding debts. A judge will then determine if you're eligible. If not, you might have the option to file a Chapter 13 case, instead.

The Speed of the Process

Chapter 7 bankruptcy is a pretty fast process once you submit the paperwork. You'll only have a couple of weeks after filing the initial petition to send supporting documents, such as tax returns and pay stubs. Likewise, the court will make every effort to schedule any necessary hearings and make a ruling within months. It's prudent to make sure you have everything ready to go before you finalize the filing.

Finality

Once a judge has granted the discharge of your debts in Chapter 7 bankruptcy, that's the end of those obligations. If you named a creditor in the case and the judge accepted it, that creditor can never come after you again for that bill.

To learn more, contact a Chapter 7 bankruptcy attorney. 

About Me

Understanding What Bankruptcy Really Means

When you begin making strides towards a healthier, more financially sound future, there are a lot of things that you can do to simplify the process for yourself. While paying down debt and working towards a simpler lifestyle can make a big difference, sometimes a bankruptcy is required to make things better. Bankruptcy will essentially clear the slate for you and your family, making it possible to move forward without worrying about heavy bills hanging over your head. On this helpful website, check out great tips and tricks that could make it possible to prevent problems in the long run, so that you can make things better.

Categories

Latest Posts

What To Expect From The Chapter 7 Bankruptcy Process
23 June 2021

People paying for Chapter 7 bankruptcy attorney se

Signs That Indicate You Might Want To File For Bankruptcy
18 May 2021

Most people never dream of filing for bankruptcy,

4 Ways to Find a Steller Bankruptcy Attorney
27 April 2021

Going through bankruptcy is a great way to get a s

Getting Ready To File For Chapter 7 Bankruptcy? 3 Things To Understand
21 April 2021

Getting out of debt can be challenging, and someti

What To Do If You Don't Meet Bankruptcy Criteria
30 March 2021

Within bankruptcy law, there are specific criteria