A Chapter 7 bankruptcy is the most common type filed when people find themselves facing overwhelming debt. Unlike a Chapter 13, this filing doesn’t require a repayment plan but absolves your unsecured debts to give you a fresh start. However, depending on your state’s laws, you may be required to sell a certain amount of non-exempt property to pay some of your creditors back.

What Are the Eligibility Requirements & Filing Process for Chapter 7 Bankruptcy?

Not everyone is eligible to file for a Chapter 7 bankruptcy, so if this is something you’re considering, you must first determine whether or not you qualify. You will have to pass a means test that is designed to show if you make enough income to pay a good portion of your debts. If you pass, credit counseling will be required before you file. Once this has been completed, you will start the process of filling out all the appropriate documents. It’s best to utilize the expertise of a bankruptcy attorney to ensure you don’t make any errors that could result in a rejection of your case. After your petition is filed, you will be scheduled for a Meeting of Creditors, where you will be asked a series of questions about your finances.

What Debts Are Discharged in a Chapter 7 Bankruptcy?

It’s important to note not all debts are discharged in a Chapter 7 bankruptcy. It will typically take care of credit card debt, medical bills, personal loans, and lawsuit judgments. You must still pay any secured debts you owe, such as student loans, back income taxes, a mortgage, car payments, child support, and alimony obligations. Before your discharge can go into effect, it’s likely you will have to attend a financial management course.

If you have mounting debt you can’t seem to get a handle on, a Chapter 7 bankruptcy may be the solution you’re looking for. Bruce Bentley, Attorney At Law has helped many residents in London, KY, successfully achieve financial relief. He is available to provide clients with all the information they need to make an informed decision about filing for bankruptcy and guide them through the process should they choose to move forward. Contact the law firm at (606) 877-0088, or visit them online to learn more.