Chapter 7

A Chapter 7 Bankruptcy is often referred to as a "fresh start". All outstanding dischargeable debt is eliminated and you start over with a clean slate.

What debts are eliminated?

Generally speaking, the following debts are discharged through Chapter 7 bankruptcy.

• Credit Card Debt
• Medical Bills
• Personal Loans
• Loans on Repossessed Vehicles
• Payday Loans
• Wage Garnishments
• Certain Tax Debts

Is my property protected?

In most cases, all or most of your current personal property is protected by state exemptions in a bankruptcy. Most cases filed are "no-asset" cases, meaning that the applicant will be allowed to keep most or all of everything currently owned. In your initial consultation we will discuss with you which state exemptions can be used to "exempt" your property.

Can I keep my car?

To eliminate your car loan in Chapter 7, the vehicle must be returned to the lender. However, if you are still able to make car payments, it is possible to negotiate a "reaffirmation" of your car loan with the lender. You would be able to keep the car, and continue to make car payments to the lender during and after the Chapter 7 Bankruptcy process. Oftentimes we are able to reduce the principal amount owed on the vehicle, interest rate, and payment amount.

Will a Chapter 7 Bankruptcy stop the annoying phone calls?

Yes. When we file your Chapter 7 Bankruptcy petition, an "Automatic Stay" takes immediate effect. This powerful legal tool stops all debt collection activity against you. The phone calls stop coming, notices stop clogging your mailbox, and perhaps most importantly, all legal activity stops, including foreclosures and wage garnishments.

Do I qualify?

Most of those considering a Chapter 7 Bankruptcy will qualify. One considering bankruptcy must pass a "Means Test" in order to qualify. This means that either there is little or no money left over at the end of the month after regular living expenses, or if your regular monthly income is at or below the average monthly income for a family of your size in your state, you would automatically qualify.

Even if you don't qualify for a Chapter 7 Bankruptcy, a Chapter 13 Bankruptcy may still benefit you. We can review all options in your office consultation.

How much does it cost?

The initial consultation with our office is completely free. You are under no obligation to pay any fees or to continue any further. This is an excellent way to learn how a bankruptcy might help you in your particular situation. During your initial consultation we will discuss the fees involved if you decide to continue.

How long does it take?

The automatic stay takes effect immediately upon filing. The hearing will take place about 6 weeks after filing, and discharge is granted about two to three months after the hearing. There is usually only one court appearance necessary, in an informal hearing room with the bankruptcy trustee. Most bankruptcy filers will never meet their judge or even enter a courtroom.

Will I ever get a loan again?

Once you've been awarded your financial "fresh start" you should take advantage by paying your bills on time, and working towards establishing a good credit history. Although the Chapter 7 Bankruptcy may appear on your credit report for up to 10 years, many lenders will consider you for a car loan or home loan in as little as 1 or 2 years after a bankruptcy.