Chapter 7 Bankruptcy
How do you know if you should file under Chapter 7 bankruptcy?
Chapter 7 is designed as a liquidation. Under this model, a trustee may sell certain property that you own at the time you file the bankruptcy case. The trustee uses the proceeds of the sale to pay creditors. However, the sale of assets in a typical chapter 7 case is unusual. In most cases, you will not have any assets over and above what the law allows you to keep. Thus, in most chapter 7 cases, you do not have any property that the trustee may sell.
About 90 days after you file chapter 7, most of your debts will be discharged, if yours is the typical case. This means you are no longer liable to pay the debt. Some debts are not discharged, however, and you still must pay them. Examples include past-due child support payments, some taxes and student loans. Debts for which you have pledged collateral for the loan (such as cars, homes and household goods) also do not go away in a bankruptcy.
The bankruptcy case addresses only the debts you list at the time of the bankruptcy case. You must pay debts you incur after filing the bankruptcy case as usual. You may keep money that you earn after filing a chapter 7 bankruptcy case, as well as most other property that you obtain after the filing.
This was just an overview. More details are provided in the Bankruptcy FAQ.
Call Christopher O’Brien at (239) 337-0448 today to schedule your free initial legal consultation.