All the information you need to make an educated decision
Chapter 7 Bankruptcy Options
Chapter 7 often is what people have in mind when they consider 'bankruptcy'. It is liquidation bankruptcy, the intended result of which is a discharge and forgiveness of debt. It can be utilized both by individuals and businesses, and usually is the preferred filing option for those who meet the eligibility requirements.
Through filing Chapter 7, your property is liquidated and sold in order to pay off as much of your debt as possible. You will be left with enough property to be able to re-start your financial life, and some property such as clothing automatically is "exempt". Any unsecured debts that remain after liquidation generally are discharged, and you no longer are held responsible for their repayment.
In the case that you do not own much property to begin with, you may be considered a "no asset" case and your property subsequently will not be liquidated. It also is possible, in rare cases, to discharge secure debts.
Liquidation bankruptcy results in a discharge of debt so that the filer no longer is liable for repayment. Property of the filer is "liquidated" and then sold, to pay off as much of his or her unsecured debt as possible. Debts that remain after the liquidation generally are discharged.
There are certain unsecured debts that either are very rarely or never discharged in bankruptcy. Federal student loans, tax debts, and spousal or child support are among these obligations.
Chapter 7 is very popular because it does not require that you repay debt. For this reason, however, there are eligibility requirements that many people do not meet. If it is judged that your income is high enough such that you can make some payments, you may not be able to file for Chapter 7. The entire filing and liquidation process generally takes about three to six months.
Chapter 7 and Chapter 13 Bankruptcy--Which is Right for You?
Chapter 7 and Chapter 13 filings each have their own advantages, but determining which might be best for you will depend on your current financial position.
Your Credit Rights After Bankruptcy: Discharged Debts and Zero BalancesRebuilding your credit should be at the top of your priorities after filing for personal bankruptcy. During this process, keep a close eye on your credit report as items can often be reported incorrectly by the credit reporting agencies. In general, all discharged debts should be reported as zero balances after bankruptcy. Often they are reported incorrectly and can end up hurting your credit more than necessary. To avoid these mistakes, understand your credit rights as a consumer even under the stain of bankruptcy.
What Happens to Cosigners When You File For Bankruptcy?Bankruptcy is a very powerful financial tool that can affect the lives of those surrounding the debtor. Cosigners of debt should pay special attention as they are often not protected by someone else's bankruptcy.
Bankruptcy and Marriage: 6 Things You Need to KnowBankruptcy is a convoluted process on its own, but involving a spouse could complicate things even further. Whether you are the one contemplating bankruptcy or your spouse is planning to file, it is important to understand how bankruptcy affects the ones around you. While it is legal for spouses to file independently or jointly together, these are six common issues that you are likely to encounter and should be aware of before filing for bankruptcy
Avoid Having Your Bankruptcy Case Dismissed: 8 TipsThe dismissal of your bankruptcy case essentially means it gets thrown out of the bankruptcy court. Once this happens, you lose the protections of bankruptcy, such as the automatic stay, and can then be held responsible for all of your remaining debts.
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