What is Chapter 7 Bankruptcy?

Chapter 7

Chapter 7 is what people usually think about when they are considering filing a bankruptcy. Chapter 7 gives you the “fresh start” you are looking for. It will eliminate all or most unsecured debt and is normally suggested for someone with very little equity in assets. Unsecured debts discharged by Chapter 7 bankruptcy include credit cards, medical bills, most personal loans, judgments resulting from car accidents and deficiencies on repossessed vehicles. However, filing Chapter 7 bankruptcy is complicated; you need an experienced and knowledgeable bankruptcy attorney to guide you through the entire legal process.

In addition to freeing you from debt, filing Chapter 7 bankruptcy normally allows you to retain your property. Keep your home, keep your car, keep your personal belongings, but eliminate your debt; that is the function of Chapter 7 bankruptcy. Conversely, if you do not file Chapter 7, you may lose your home to foreclosure and your car to repossession, you will eventually be sued and your wages could be garnished. When you come in for your FREE CONSULTATION, you will get reliable advice from our compassionate and experienced staff.

How Do I File a Chapter 7 Bankruptcy?

Preparing a Chapter 7 is a lot of work and a lot of documents that are needed from you. Of course, we do prepare all of the documents that are submitted to the court but we can’t do it without your help. A Chapter 7 consists of schedules that list assets, debts, income, and expenses. There are statements about your recent financial history. We also prepare the Means Test. The Means Test was designed to determine whether or not you qualify to file a case under chapter 7 of the Bankruptcy Code, and if not, how much you need to pay your unsecured creditors in a Chapter 13 case.

Everyone who files a bankruptcy is required to do Credit Counseling. This sounds much more daunting than it really is. You can do it online and it usually takes less than an hour.

We have many years of experience to make the process as easy and painless as possible for you.

What Happens After the Chapter 7 is Filed?

As soon as your Chapter 7 is filed the Automatic Stay goes into effect which stops all collection activities against you. Creditors are forbidden to call you or send you collection letters, place a garnishment on your wages, place a lien on your home, or contact you in any way regarding payment of the debts. ALL collection activity has to stop

About one month after your case is filed you will be required to attend the Meeting of Creditors. Of course, we attend this hearing with you. At the Creditors Meeting you meet the Trustee and he asks you a series of questions. As long as you have been honest in the petition that is originally filed and the paperwork is done correctly your hearing should go smoothly.

After the case is filed you are required to do a Financial Education course. This can be done online and generally takes 2 to 2.5 hours.

Usually 60 – 90 days after your Creditors Meeting you receive your Discharge in the mail and your case is over.

The ability to reestablish your credit after filing Chapter 7 bankruptcy will be better than it ever was before. Although Chapter 7 bankruptcy will remain on your credit report for up to 10 years, you can start reestablishing your credit right away. Though you may have to pay slightly higher interest rates, you should be able to purchase a home or car and qualify for credit cards very soon after filing Chapter 7 bankruptcy.

At the Law Offices of John C. Kyle and Gregory J. Smith we have over 65 years of combined experience in all facets of both Chapter 13 and Chapter 7 bankruptcy. We will be your advocate throughout the entire Chapter 7 bankruptcy proceedings.