Chapter 7 Bankruptcy
Think of a Chapter 7 Bankruptcy as the magic button that can get rid of your debts and give you a chance to start fresh with a clean slate. In addition to eliminating your debt, in most cases a Chapter 7 can actually help you start building your credit by giving your credit score a boost after filing. It will help you spend your money on more important expenses.
Here are some ways that filing for bankruptcy can help a Debtor:
1. Discharge unsecured debts. (Credit Cards, Personal Loans, Medical Bills, etc.)
2. Allows a Debtor to cancel a contract or lease if the Debtor would like to do so. (Examples include; Car Lease, Timeshare, Apartment Rental, Payments for secured items, etc.)
3. Allows Debtor some breathing room by stopping real estate foreclosures.
4. Allows Debtor to avoid judgments, liens from Judgments and collections from Judgments.
5. Allows Debtor to do away with most law suits without litigation.
6. Stops Wage Garnishments and other collections methods.
7. Stops harassing phone calls from Creditors.
8. In most cases it gives you an automatic boost in your credit score.
In order to file a Chapter 7 Bankruptcy, the debtor may be an individual, a partnership, or a corporation or other business entity. However, only individuals can receive a discharge in a chapter 7 bankruptcy and businesses usually file a chapter 7 for very specific reasons.
To qualify for a chapter 7 an individual debtor must pass an income test known as the “means test.” The amount of the income test is based on the number of people in your household. Moreover, since a Chapter 7 bankruptcy is a liquidation of any “non-exempt” assets a debtor must consider if there are any assets that might be sold through the chapter 7 liquidation process. In most cases the debtor does not have any non-exempt assets but that is why it is very important to consult with a qualified and experienced bankruptcy attorney in order to determine if a chapter 7 bankruptcy is the right decision for you.
If you would like to know if you qualify for a chapter 7 bankruptcy or discuss your financial options you can always call me for a free consultation. Even if you decide not to retain me you will leave the consultation with the information you need to make the right decision for yourself. Remember that I also represent Chapter 11 and Chapter 13 bankruptcy filers. Call 818-649-0879.