Clear All Debts With Chapter 7 Bankruptcy

A Chapter 7 Bankruptcy is a type of bankruptcy proceeding that is also referred to as a straight or liquidation bankruptcy. While it is the fastest and most common form of consumer bankruptcy, it should be viewed as an option of last resort because it leaves a serious mark on a credit reports for 10 years.

Why Chose a Chapter 7 Bankruptcy

Through this process, unsecured debts can be forgiven. Unsecured debts are those with no attached collateral such as medical bills, credit card debts and personal loans.

This process may be a good option if:

• You don't have many assets;
• Your combined problem debts are more than 40% of your annual income;
• Your debts qualify for forgiveness; and
• It would take at least 5 years to pay off the debt even with extreme measures.

Through this process, debtors are repaid to the extent possible and the remaining debt is "discharged" by the creditor and is no longer owed.

What Happens When You File for Chapter 7 Bankruptcy

Before you begin this process, it is important to hire a qualified and experienced bankruptcy attorney who can assist you in filing paperwork and other necessary steps. Filing for bankruptcy is a complex process and if papers are improperly completed or incomplete, you case can be thrown out by the court of some debts might not be forgiven.

The next steps are:

• You must complete mandatory credit counseling from a qualified nonprofit agency.
• You and your attorney will completing and file the required paperwork.
• The court will appoint a trustee to manage the process.
• You, your attorney and the trustee will meet with your creditors.
• The trustee will make a determination as to whether or not you qualify for Chapter 7 Bankruptcy.
• The trustee reviews your assets to identify the non-exempt items that can be sold to pay creditors.
• The trustee will review your secured debts and may be ordered to return the collateral property to the creditor.
• You will need to take a financial education course from a qualified nonprofit credit agency.
• Your eligible debts are forgiven and your case is closed.

This process is often completed within 3 to 6 months of filing the petition.

If you are considering filing a Chapter 7 Bankruptcy, please call our Tampa office. An attorney will be happy to discuss your situation and determine your best options.