Need Information on Chapter 7 Bankruptcy?
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You may finally have the chance to get rid of those sleepless nights, stop the creditors from calling, and get your peace of mind back.
Total Lawyers has the information you need on Chapter 7 bankruptcy. In addition, we also have a network of experienced bankruptcy attorneys to assist you with a Chapter 7 bankruptcy filing.
Give us a call at 1 (877) 349-1309 or complete our free bankruptcy evaluation form. Once we receive your information, we will put you in touch with a local bankruptcy attorney in your area. Now, let's talk about Chapter 7.
Chapter 7 bankruptcy may be the right choice for you if:
- You have low or no income;
- You have little or no money remaining after paying necessary living expenses each month;
- You rent or have little equity in your home;
- You have very few or no assets besides your furniture, clothing and other necessities; and
- You haven't filed in the past eight years (you can only file once in eight years).
Chapter 7 is designed to give you a "fresh start" in your financial future. However, before you can "re-write" your financial history, you must pass a means test in order to be eligible for a Chapter 7 bankruptcy filing.
The means test is a two-part test designed to compare your household income to the median income of a family of your size in your state. If you fall below the average median income of a family your size in your state, you pass the means test. However, you if "fail" the first part of the test, the second phase of the test is implemented.
The second part of the test involves calculating your disposable income and your unsecured debts. If the calculation yields a number less than $6,000 for the next five years ($100 per month), you qualify to file under Chapter 7. If you find that your disposable income over the next five years will exceed $10,000, you will only be eligible to file under Chapter 7 if you can prove you have special circumstances.
A local lawyer can explain this process to you in more detail and answer any questions you might have.
Credit Counseling
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires that prior to filing a Chapter 7 bankruptcy petition, you must receive a briefing from a certified credit counseling agency. Failure to obtain this briefing before filing can cause your case to be dismissed. The agency will educate you on financial management and how to do a budget analysis, and will provide you with possible alternatives to bankruptcy. Your bankruptcy attorney can refer you to a certified credit counseling agency.
Debts Chapter 7 Bankruptcy Can Eliminate
If a debt is unsecured, meaning that there is no collateral backing it up, it can normally be discharged in a Chapter 7 bankruptcy case. Examples of unsecured debt include:
- Credit card debt;
- Medical bills;
- Many forms of personal loans;
- Judgments resulting from automobile accidents;
- Shortages on repossessed automobiles;
- Some older tax debts;
- Payday loans; and
- Garnishments.
Debts Chapter 7 Bankruptcy Cannot Eliminate
Even bankruptcy cannot erase all your financial troubles. You will still be liable for non-dischargeable debts like child support, some taxes and most student loans.
The Final Step
Before you receive the Chapter 7 discharge, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires that you complete a course about personal financial management. Your bankruptcy lawyer can refer you to the appropriate class.
Making the choice to file bankruptcy is something that should not be taken lightly.
Chapter 7 bankruptcy can provide you with the protection you need against creditor harassment.
Get started today by calling us toll-free at (877) 349-1309 and speak with a sponsoring bankruptcy lawyer. Or feel free to use our secure online case evaluation form, and we'll connect you with a bankruptcy attorney in your area.