A Future without Creditors on the Attack
First come the phone calls, then come the garnishments. A chapter 7 bankruptcy can help take care when credit cards, hospital bills, and foreclosure deficiency creditors go on attack. These creditors often don't understand that your failure to pay does not come from a lack of desire to pay them, but a lack of income.
A simplified way to explain a chapter 7 bankruptcy is that it is a going out business sale for an individual. The bankruptcy from the date of filing to the issuance of the discharge is generally four to five months and provides quick relief. The process moves fast, but it does not mean a chapter 7 bankruptcy should not be taken seriously. Failure to make all the necessary disclosures and to ensure that the schedules are complete and accurate can make for a very stressful chapter 7 bankruptcy. A chapter 7 trustee is appointed to each chapter 7 case and will be verifying and investigating the information disclosed in the chapter 7 bankruptcy filing. The chapter 7 trustee will be looking over everything for veracity and completeness. The chapter 7 trustee is a facilitator for the case, but also makes a certification for the creditors that the debtor has no assets and that the debtor, or debtors, truly do not own anything above his or her exemptions to provide for payment to the listed creditors.
A chapter 7 bankruptcy can effectively stop the phone calls from creditors and discharge your obligation to pay these unsecured creditors if you qualify.
Do I qualify to be a chapter 7 debtor?
A chapter 7 bankruptcy is a good option for clients who do not own a lot of assets and do not have the monthly income to provide payments in a chapter 13 bankruptcy plan. Whether the client qualifies for a chapter 7 bankruptcy filing is determined by an analysis of the client's last 6 months of income using the means test.
Will I have to pay anything to my creditors?
If the client qualifies to file a chapter 7 bankruptcy, then the next step is an analysis of the client's assets to ensure that exemptions available to the client in bankruptcy are sufficient to the client's needs and the client will be able to exit the chapter 7 with sufficient assets to move on with life after the bankruptcy discharge is entered and the client receives his or her fresh start.