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Financial pressure can impact every aspect of your life, including your job performance, relationships, and even your health. Fortunately, Chapter 7 bankruptcy provides a way out, allowing you to wipe the slate clean and start your life over again. Understanding the benefits of bankruptcy and knowing what to expect can help you decide whether liquidating your debt is the right financial move for you.

What Is Chapter 7 Bankruptcy?

chapter 7 bankruptcyA Chapter 7 bankruptcy completely eliminates most unsecured debt, including credit cards, medical debt, lines of credit, and even some back taxes. In exchange, the trustee may seize some of your assets to pay back your creditors, although each state allows you to exempt some home equity and other assets. In fact, many petitioners can discharge their debts without surrendering any of their belongings at all.

To qualify, struggling borrowers will have to pass a means test to prove that they’re unable to meet their financial obligations. Once the bankruptcy is discharged, you won’t be responsible for any of the discharged debts and can immediately start rebuilding your life.

What to Expect After Filing Bankruptcy

Filing for bankruptcy immediately triggers an automatic stay, which puts an immediate stop to all collections efforts. Before discharging your debts, the trustee will look over your financial records for the previous year to see whether you’ve transferred major assets or made luxury purchases. In most cases, you’ll only have to attend a single meeting of the creditors and likely won’t have to appear in court.

Why You Need an Attorney

The bankruptcy code is extremely complex, so having an attorney on your side is instrumental in achieving a positive outcome. Your lawyer will ensure that all of your eligible debts are discharged and that you keep as much of your personal property as possible. They’ll also help you avoid common mistakes that could have your petition dismissed and will even attend the meeting of creditors on your behalf.


 

As one of Nebraska’s leading debt relief attorneys, Sam Turco Law Offices is not your typical bankruptcy law firm. Their principal attorney regularly lectures in front of the state bar and teaches the finer points of bankruptcy law to legal professionals across the state. Visit their website to learn what sets them apart, get more tips and advice on Twitter, or call (402) 614-7171 to find out whether Chapter 7 bankruptcy is right for you.

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