Chapter 7 Bankruptcy

A Chapter 7 Bankruptcy is known as a “consumer liquidation bankruptcy.” This allows an individual, or a husband and wife to file for protection under the court’s bankruptcy laws. When you file for Chapter 7 protection, the bankruptcy court will issue what is known as a “bankruptcy stay.” This is an order of the court that your creditors cannot contact you, pursue litigation against you or even charge you interest while you are in bankruptcy. You will generally be in bankruptcy for three months.

During the three months that you are in bankruptcy, you will attend a hearing with the trustee that is assigned to the case. Our attorneys will attend the hearing with you. The trustee’s job is to find out if there are non-exempt assets that he or she can administer. Most people who file for Chapter 7 protection do not have assets that are administered by the trustee. This is because the code provides certain exemptions, i.e. assets a person may keep after they file bankruptcy, such as a vehicle worth no more than $2,150.00, or furniture worth no more than $3,000.00. If you have assets which are more extensive, we will need to discuss them before you file for bankruptcy protection. At the end of the three month period, the court will issue your discharge order in most cases. This is the order that discharges your debts. Once you have completed your bankruptcy you will be able to begin rebuilding your credit.