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Chapter 7 bankruptcy procedure is a commonly used bankruptcy chapter amongst the US residents. As per stats, over 70% of bankruptcy is applied through Chapter 7. Even though it is popular and used in the majority of the United States, it is not necessarily the best option available for you. To make a wise decision about whether Chapter 7 is appropriate for your situation, we list below everything you need to know about the Chapter 7 bankruptcy procedure-
- What kind of debts are discharged?
Most of the debts that do not have a backing or a lien are discharged. These may include debts like medical expenses incurred but not paid, personal loans that are unsecured, credit card debts, some payday loans, Federal tax debts, etc. This type of bankruptcy procedure under Chapter 7 is referred to as ‘liquidation’ as well as on most occasions it leads to the sale or liquidation of the assets held by the applicant.
- What kind of debts continue?
Certain types of liabilities cannot be evaded even with Chapter 7 insolvency. These continue even after declaring bankruptcy. These may include tax liens, child support payments, alimony as per the agreement, court dues, penalties, and any other debts that may deem ineligible by the court or by law.
- Hints to consider Chapter 7 bankruptcy
If your debts require you to earn 5 years or more to pay off under the best circumstances, it’s an alarm to start seeking out experts for help. If your debt is giving you sleepless nights, it’s time to just dial 888-297-6203 and get the best solutions at your fingertips. Apart from these two nightmare tests, if you are left with no or very less disposable income, it is a hint to consider insolvency. Finally, the last hint is if your monthly household income is below your state specified median to file Chapter 7. In summary, these are all hints that your finances aren’t in the right order and you need professional assistance.
- How to file for Chapter 7 bankruptcy and what to do before filing?
Filing Chapter 7 bankruptcy isn’t so easy. There is a need to do some math as well as ensure all the information provided in the filing application is accurate. If you are from Los Angeles & Dallas, TX, this link https://recoverylawgroup.com/bankruptcy/ can help you access the best attorneys in the market to help you file bankruptcy under Chapter 7 effortlessly. There are some initial preps also that need to be done before filing bankruptcy. The most common ones can be listed as follows-
- Any settlement with certain creditors may be relatives, or family members before 6 months of the filing of a bankruptcy can be treated as malpractice and intentional. To ensure fair and unbiased treatment of all debts, no partial or full settlement of debts should be undertaken before 6 months of applying for bankruptcy
- Any new debt just before applying for bankruptcy might call in for undue scrutiny and might delay or cause rejection of bankruptcy application. Any new debt should be avoided when considering a bankruptcy decision
- Any unusual or suspicious transfers of assets or sale of assets or transfer of funds to friends, relatives, businesses, etc., can lead to serious legal complications and it can be inferred as fraud.
- Avoid using retirement funds to settle debts as under most circumstances, retirement fund money is untouched and can be used for future
- Being honest and using common sense is the most common suggestion your attorney will give you. It is necessary to abide by the same to minimize further complications, legal procedures, or delays in the bankruptcy procedure
After understanding these aspects, it is also necessary to analyze the pros and cons based on your situation. This can be effortlessly done by checking out https://recoverylawgroup.com/bankruptcy/.