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A Quick Guide to Chapter 7 Bankruptcy

| Apr 2, 2017 | Bankruptcy |

Are you considering filing for bankruptcy? A Chapter 7 bankruptcy can result in you discharging all of your debt.

How Does It Work?

When you file for Chapter 7 bankruptcy, a vast majority of your unsecured debts, including credit card debt, medical bills, and personal loans, are discharged or forgiven. You will be required to thoroughly document your assets, income, and a list of all your creditors. In most cases, our Chapter 7 clients do not have to give up any of their assets, but this is not always the case. A highly skilled bankruptcy attorney can advise you as to how to preserve your assets.

What Are the Requirements?

In order to file for Chapter 7 bankruptcy, you cannot have filed for Chapter 7 within the past eight years. If you have previously filed a Chapter 13, in most cases, you will have to wait six years to file a Chapter 7. Most of your debts will be discharged, but some debts such as child support, most tax debts, and student loan debt are not. Some high-income debtors will not be permitted to file a Chapter 7 and will be required to file a Chapter 13. High-income debtors should consult a bankruptcy

Is Chapter 7 Right for Me?

Deciding whether to file can be difficult. Frequently, the decision to file is based upon the number of years it will take a debtor to become debt-free. In some cases, a debtor will never be able to pay off their debts given the debtor’s income. The age of the debtor is an important factor. For younger debtors, taking five years to pay off their debts may not seem to be too long, but older debtors, who are on a fixed income five years may take too long, and a bankruptcy filing may be required. Frequently, our clients feel a moral obligation to pay their creditors in full. We tell these clients that a bankruptcy filing permits the debtor to decide when, if, and how much they will pay their creditors. In some instances, our clients have paid back their creditors in full after they have filed for bankruptcy. But the amount and length of time to pay the creditors back is determined solely by the debtor.

If you still are not sure which way to turn or which chapter of bankruptcy is right for you, you can always reach out to the experts in the field – The Bankruptcy Advocates. We will guide you through the entire process, from start to finish, and ensure that you feel secure until the end. Call us for your free consultation today at (618) 549-9800.