Chapter 7 Bankruptcy Information
Chapter 7 bankruptcy is commonly used by individuals who have only basic property, with little or no money beyond what’s needed for monthly essentials. In simple terms, it is essentially the “clean slate” bankruptcy that allows a consumer to wipe clean the past and start over.
How to Decide if You Should File for Chapter 7 Bankruptcy
The Chapter 7 bankruptcy means test can be employed to help you figure out if you qualify. Since the means test can be complex, it’s always advisable to have an experienced Chapter 7 bankruptcy attorney assist you in the process. There’s a more detailed summary of the means test located under the “How to Decide if Filing for Personal Bankruptcy is For You” section on this page.
If a consumer qualifies for bankruptcy by demonstrating that they do not possess the income or assets to pay their debts and cover their essentials, the consumer can ask a court to discharge each debt. Once discharged, the debts are no longer payable by the consumer. This gets the debt collectors to go away.
Of course, it’s imperative to know your debt collection rights as many debt collectors actually use illegal practices. Learn more about proper debt collection laws here.
Once you discover if you quality to file for Chapter 7 bankruptcy, the process often moves fairly quickly. Your debts may be discharged within just a few months.
The other advantage of Chapter 7 bankruptcy is the “automatic stay.” This means that once the petition is filed, each and every creditor gets an official notice and must stop all attempts to collect money from you. This includes any lawsuits that have been filed. If a lawsuit is currently pending, the case must immediately be held off until it is determined that you are discharged from bankruptcy or not. This can help ease any stress that you’ve been undergoing regarding lawsuits and debt collectors.