Chapter 7 FAQs

  •  Most persons who seek our help DO qualify for Chapter 7 bankruptcy. Chapter 7 bankruptcy is available to consumer debtors whose income does not substantially exceed their income. Even if your income is above the “median” (median is the middle point: half the state earns more and half the state earns less), you can qualify for chapter 7 bankruptcy if your necessary obligations (including taxes, mortgage, car payments) fully offset your income.
  • If a consumer debtor does have “too much” income for chapter 7 bankruptcy, they can file chapter 13, which lets them MANAGE their debt; they repay it over time, often for pennies on the dollar.
  • There are exceptions to qualify high income earners, including persons with mostly business or tax debt.
  • Chapter 7 bankruptcy filers almost always keep all their property.
  • There is no explicit minimum debt requirement for chapter 7 bankruptcy.
  • To file chapter 7 bankruptcy, you need to wait 8 years from the time you had filed a prior chapter 7 (that ended in discharge or cancellation of debt), or 6 years from the time you had filed a prior chapter 13 (shorter if that chapter 13 paid off a very high amount of debt).
Category: Chapter 7 FAQs

About a month after a Chapter 7 Bankruptcy is filed, you MUST attend the so-called Meeting of Creditors. “So-called” because creditors often don’t appear. The meeting–conveniently conducted via telephone or Zoom–typically amounts to a very-brief interview with a chapter 7 trustee. She will confirm your identity and have you answer (mostly basic yes/no) questions to confirm that you’ve truthfully reported your financial affairs in the bankruptcy papers filed with the court. The trustee will also verify receipt of supporting documentation. We work hard to satisfy all requirements in advance to ensure the meeting amounts to an uneventful formality. We also fully prepare our clients to help eliminate any stress or uncertainty in regard to the meeting and the progression of their case.

Category: Chapter 7 FAQs

Your bankruptcy discharge followed by case closure is due about 61 days after the meeting of creditors (or 3 months from the filing date). During that interim we may discuss reaffirmation (reinstatement) of any secured loans (without any detrimental change to terms), which may be helpful for noticing purposes (otherwise, you don’t receive billing statements) and rebuilding credit, After bankruptcy, your credit can improve: by eliminating old debt, you can later take on new obligations, such as mortgages. Your income to debt relationship will be restored to a proper ratio. While there are exceptions to cancellation of debts (like student loans), the chapter 7 bankruptcy discharge is a powerful, cost-effective remedy to wipe out most types of debt and obtain a fresh start,

Category: Chapter 7 FAQs

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