| Chapter 7 Overview
Chapter 7 is the most common type of bankruptcy, it is sometimes referred to as "liquidation bankruptcy," or "straight bankruptcy." The basic purpose of chapter 7 is to provide you with a fresh start by wiping out all qualifying debts including credit cards, medical bills, repossession deficiencies, law suits as well as a variety of other debts. Bankruptcy lawyers can help with the process. In chapter 7 there is no repayment required for most unsecured debts, your debts are wiped out completely and permanently. In about 99% of chapter 7 cases, the consumer keeps all property, and eliminates most debts. The entire process usually takes less than 4 months to complete. After the bankruptcy is over, the consumer may choose to selectively pay back debts, such as debts to family members, however repayment is not legally required.
The Chapter 7 Process
First you meet for a free consulatation with one of our attorneys. At this free consultation the attorney will evaluate your case, discuss the risks and benefits of filing for bankruptcy. After you provide our office with all the required documents your paperwork will be prepared and you will personally sign your documents and take a credit counseling course in our office. In chapter 7 the typical consumer only has one meeting with the bankruptcy trustee. We will go to court with you on this day. The purpose of the meeting is to give creditors a chance to ask questions, although it is very rare that a creditor shows up; it is mostly handled by attorneys. Before you go to your meeting you will complete a financial management course which will help get you back on track financially. Then, when you go to your meeting the trustee may ask you questions about particular items on your petition usually focusing on assets or income. Most meetings take only a few minutes. Some consumers feel some level of anxiety or fear leading up to the meeting with the bankruptcy trustee, but there is no reason to fear the trustee. The trustee is looking for people who are hiding assets or trying to defraud the system, they don't want to harass or scare the common consumer. The meeting will take place in an ordinary conference room or courtroom, and the trustee is not a judge; the setting is informal. After the meeting, the first thing most people say is "...that's it?...that was easy." Once the meeting with the trustee is done, the only thing left to do is keep your address current with the court, and wait for your discharge to come in the mail. |
