attorney how to guide to chapter 7 bankruptcy

Who can file Chapter 7 bankruptcy?

Mar 24, 2015 · An experienced attorney will help you complete required forms, develop a feasible debt repayment plan, and guide you through the rest of the Chapter 7 process. That’s important because the bankruptcy court clerk's staff is prohibited from giving you legal advice, including instructions on how to complete bankruptcy forms.

How much does a Chapter 7 bankruptcy cost?

A Chapter 7 Bankruptcy Petition allows a debtor to "discharge," or eliminate, most – if not all – of their unsecured debts. A bankruptcy reduces balances to zero for certain debts owed, like credit cards, unsecured personal loans, and back utility bills. You may have heard this described as a "fresh start," and in many cases, it could be ...

How much to file Chapter 7?

Mar 09, 2018 · In order to qualify for a Chapter 7 bankruptcy you have to submit your income and debt information for review. The amount of secured debts you have will be compared to the amount of income you bring in, and if your income shows no ability to repay any of your unsecured debts after making secured debt payments each month, you will be allowed to file …

What to expect after Chapter 7 discharge?

In a Chapter 7 bankruptcy, the debtor turns over all his non-exempt property to the bankruptcy trustee for liquidation, while keeping all of his exempt property. Though bankruptcy procedures take place in federal courts, property exemptions are controlled by state law and vary widely. However, the following items are usually exempt; that is ...

How do I prepare for Chapter 7?

The first step to prepare for bankruptcy is to gather proof of your income. Copies of your tax returns and copies of proof of income for the past six months are required when you file a Chapter 7 case. To prepare for bankruptcy under Chapter 7, you must complete the Chapter 7 Means Test.Sep 3, 2020

Do you lose everything when you file Chapter 7?

After filing for Chapter 7, your property will go into a bankruptcy estate held by the Chapter 7 bankruptcy trustee appointed to your case. However, you don't lose everything because you can remove (exempt) property reasonably necessary to maintain a home and employment.

What Cannot be discharged in Chapter 7 bankruptcy?

Filing for Chapter 7 bankruptcy eliminates credit card debt, medical bills and unsecured loans; however, there are some debts that cannot be discharged. Those debts include child support, spousal support obligations, student loans, judgments for damages resulting from drunk driving accidents, and most unpaid taxes.

What are 2 consequences of filing Chapter 7 bankruptcy?

You'll still have to pay court-ordered alimony and child support, taxes, and student loans. The consequences of a Chapter 7 bankruptcy are significant: you will likely lose property, and the negative bankruptcy information will remain on your credit report for ten years after the filing date.

What happens to your bank account when you file Chapter 7?

In most Chapter 7 bankruptcy cases, nothing happens to the filer's bank account. As long as the money in your account is protected by an exemption, your bankruptcy filing won't affect it.Feb 6, 2021

Can creditors collect after Chapter 7 is filed?

Can a debt collector try to collect on a debt that was discharged in bankruptcy? Debt collectors cannot try to collect on debts that were discharged in bankruptcy. Also, if you file for bankruptcy, debt collectors are not allowed to continue collection activities while the bankruptcy case is pending in court.Oct 25, 2017

What are 5 types of debt that are not dischargeable in bankruptcy?

Nondischargeable debt is a type of debt that cannot be eliminated through a bankruptcy proceeding. Such debts include, but are not limited to, student loans; most federal, state, and local taxes; money borrowed on a credit card to pay those taxes; and child support and alimony.

What type of debt Cannot be discharged through bankruptcy?

Other Non-Dischargeable Debts in Bankruptcy 401k loans. Other government debt such as fines and penalties. Restitution for criminal acts. Debt arising from fraud or false pretenses.Nov 2, 2020

What is the means test for Chapter 7?

The bankruptcy means test determines whether you're eligible for Chapter 7 bankruptcy. The bankruptcy means test determines who can file for debt erasure through Chapter 7 bankruptcy. It takes into account your income, expenses and family size to determine whether you have enough disposable income to repay your debts.

What debts are dischargeable?

Dischargeable DebtsDischargeable debt is debt that can be eliminated after a person files for bankruptcy. ... Some common dischargeable debts include credit card debt and medical bills. ... In Chapter 7 cases, a discharge is only available to individuals but not to corporations or partnerships.More items...

What happens to the property in Chapter 7?

In a Chapter 7 bankruptcy, the debtor turns over all his non-exempt property to the bankruptcy trustee for liquidation , while keeping all of his exempt property. Though bankruptcy procedures take place in federal courts, property exemptions are controlled by state law and vary widely. However, the following items are usually exempt; that is, they are not required to be turned over to the bankruptcy trustee:

How does bankruptcy work?

When a debtor files for bankruptcy under Chapter 7, the Bankruptcy Court imposes an automatic stay on the bankruptcy estate. An automatic stay prevents creditors from attempting to foreclose or repossess any property or to collect on the debt without seeking the permission of the Bankruptcy Court. Additionally, an automatic stay prevents creditors from making collection phone calls or initiating any lawsuits against the debtor. The automatic stay remains in place until 1) the judge lifts the stay at the request of a creditor, 2) the debt is discharged, or 3) the property in question is no longer part of the bankruptcy estate.

Do I need an attorney to file for bankruptcy?

While there is no requirement that a debtor hire an attorney in order to file for bankruptcy, certain areas of law are much more easily navigated with the assistance of an experienced and competent attorney. Bankruptcy is undoubtedly one such area. Attorneys will be able to guide a debtor through the myriad of requirements mandated by the U.S. Bankruptcy Code, as well as help a debtor determine what property is exempt from liquidation. A list of qualified bankruptcy attorneys in a debtor’s area can usually be obtained from the local Office of the Clerk of U.S. Bankruptcy Court or from a local bar association.

What happens when a bankruptcy trustee liquidates the estate?

If the Court confirms that the debtor is eligible to file under Chapter 7, the bankruptcy trustee begins liquidating the estate. The debtor turns over all non-exempt property, which the bankruptcy trustee uses to repay all or a portion of the outstanding debt .

How does a secured debt keep its value?

Essentially, a reaffirmation is an agreement between the creditor and debtor, stating a new payment schedule that is within the budget of the debtor. Normally, this debt would be discharged and the property seized, but it can be kept so long as the debtor continues to make the agreed upon payments.

What happens at a final hearing in a bankruptcy case?

At a final hearing, the Court confirms that all requirements have been met, all non-exempt property liquidated, and all or a portion of the creditors repaid. The Court will then grant the debtor a discharge of the remaining debt. The case is then closed and the debtor is no longer liable to his creditors.

How long does it take for a 341 creditor to meet with creditors?

Anywhere from one to three months after the bankruptcy petition is filed, the 341 creditor’s meeting takes place. This is typically a short meeting where the creditors have the chance to gain additional information about the debtor’s finances and ability to repay his debt.

What is the most common type of bankruptcy?

There are different types of bankruptcy. Chapter 7 or liquidation bankruptcy is the most common form of a bankruptcy filing. The main objective of Chapter 7 bankruptcy is for the assigned trustee in bankruptcy to sell your assets to repay debts to creditors. Here, dischargeable types of debt include credit card bills, medical bills, and personal loans.

Can you keep your home if you file for bankruptcy?

If you file for bankruptcy Chapter 7, you would be entitled to retain your home or vehicle if you are current on the loan payments and will exempt any of the equity. However, if you fall behind on paying your loans or are unable to maintain all your equity, most likely you will lose it. Chapter 7 could not be a good idea unless you are willing to give up certain properties.