Filing for Chapter 7 bankruptcy protection involves wiping out debt, and in some cases, liquidating your assets to pay off creditors. A Chapter 7 gives the person a financial fresh start.
The entire process takes between 3 to 5 months and can get you back on the right path quickly. For those who own homes and other significant assets, as well as those who have high income, it may not be the best option for debt relief; however, Chapter 13 protection might be your solution.
The benefits of filing a Chapter 7 bankruptcy begin immediately:
- Creditors cannot contact you to collect on a debt.
- Lawsuits are stopped (such as foreclosure proceedings and car repossessions).
- Wage garnishment and bank accounts freezes are lifted.
- All dischargeable debt is wiped.
- In the vast majority of cases, a person will get to keep all of his or her assets.
Creditors may petition the court to continue certain lawsuits, such as foreclosure actions and eviction proceedings, however they must obtain permission from the Bankruptcy Court before they can continue the lawsuit.
At the end of the process, most people will walk away completely debt free. There are only a handful of debts that are not discharged at the end of the proceeding. These debts include back child support, alimony obligations, and student loans. I add student loans here because, although it is possible to discharge them, the standard a person has to meet is extremely high, which makes these loans virtually non-dischargeable.
Note that taxes are not listed here; that is because some taxes can be discharged in a bankruptcy as long as they meet the standard and the process is followed correctly.
At the Law Office of Christian Veras, LLC we can help you discharge your debts through a Chapter 7. We will analyze your circumstances and give you candid advice if bankruptcy is the right solution for you. Check this article if you think it is time to consider bankruptcy.
DISCLAIMER: The purpose of this article is for educational use only. The information contained in it does not constitute legal advice and an attorney-client relationship is not created by reading this post.
Christian Veras, Esq.