Chapter 7

Chapter 7 is what most people think of when they think of bankruptcy. Briefly, in a Chapter 7 proceeding, the person or couple that files is seeking to discharge (or get rid of) as much debt as possible. A Trustee is appointed to "administer the assets of the estate." (take items that you have and sell them to raise money to pay creditors).

What Debts are and are not elegible for discharge in a chapter 7?

Generally, any debt that IS NOT fraudulent, a domestic support obligation, an education related debt, new taxes or business taxes, personal injury if you were drunk, or willfully or maliciously incurred is elegible for discharge in a chapter 7. Therefore, most medical bills, credit cards and loans can be discharged in a chapter 7. Since there are always exceptions, if you have an unusual debt, we would need to meet with you to discuss your situation. Please call for your first, free consultation.

What Assets might I lose in a chapter 7?

Generally, you get to keep your basic, necessary household goods in a chapter 7. Common items that a trustee can take include: income tax refunds, luxury items, including luxury household goods, the money that is in your bank account on the date that you file, accounts receivable (if you are self-employed), non-business related tools, business related tools over the protected amount, and your vehicles, if there is equity over the protected amount. There are other exemptions (protections) that you can claim. To review those specifically, come in and we will discuss your specific situation with you.