Chapter 7 Bankruptcy
Chapter 7 allows you to typically keep all of your property that is pledged as security for a loan. As long as your car and mortgage payments are current, and there is no significant equityThe value of a debtor’s interest in property that remains after liens and other creditors’ interests are considered. (Example: If a house valued at $100,000 is subject to a $80,000 mortgage, there is $20,000 of equity.) in your property, you should be able to reaffirm the debt. However, if you do not want to keep the property and still be responsible for the debt, you can surrender the property to the lender and your debt will be discharged. Typically, individuals filing a Chapter 7 bankruptcy keep their home, their car, and their personal belongings.
During the Chapter 7 bankruptcy process, you will submit all of your financial information to the court and your debts and assets will be reviewed by the court appointed trusteeThe representative of the bankruptcy estate who exercises statutory powers, principally for the benefit of the unsecured creditors, under the general supervision of the court and the direct supervision of the U.S. trustee or bankruptcy administrator. The trustee is a private individual or corporation appointed in all chapter 7, chapter 12, and chapter 13 cases and some chapter 11 cases. The trustee’s responsibilities include reviewing the debtor’s petition and schedules and bringing actions against creditors or the debtor to recover property of the bankruptcy estate. In chapter 7, the trustee liquidates property of the estate, and makes distributions to creditors. Trustees in chapter 12 and 13 have similar duties to a chapter 7 trustee and the additional responsibilities of overseeing and your creditors. All your creditors will be notified of your bankruptcy and instructed to cease all collection action unless the court later approves some action.
Chapter 7 bankruptcies are also known as liquidations because any non-exempt assets that the debtorA person who has filed a petition for relief under the Bankruptcy Code. has may be liquidated (sold) by the trustee for the benefit of the creditors. Most Chapter 7 bankruptcy debtors do not have any non-exempt assets, so they are able to keep all of their personal and real property.
Chapter 7 bankruptcies benefit individuals and families because they eliminate the stress of paying their unsecured debts, while allowing individuals to keep most of their property and assets. Filing a Chapter 7 bankruptcy petitionThe document filed by the debtor (in a voluntary case) or by creditors (in an involuntary case) by which opens the bankruptcy case. (There are official forms for bankruptcy petitions.) stops foreclosure proceedings, wage garnishment, creditorOne to whom the debtor owes money or who claims to be owed money by the debtor. harassment, and other collection actions that stress out individuals facing overwhelming debt.
Contact an experienced Chapter 7 bankruptcy attorney to determine which options are right for you. Call (949) 450-8500 today for your FREE consultation.
Or simply call: