Chapter 7

A chapter 7 bankruptcy provides relief to the debtors by granting a discharge of certain debts to give an individual a “fresh start”. This fresh start has been provided for nearly 200 years and is based on the proposition that the debtor’s future income should belong to the debtor. None of the debtor’s federal or state rights are denied because they choose to file bankruptcy. New statistics estimates that every 30 seconds someone is filing bankruptcy. Empower yourself with information, take advantage of your rights and reclaim your future free of debt. Although collection agencies may argue that you must repay your debt; the debtor has no liability for discharged debts which may include:

• Surrendered real property
• Surrendered Cars
• Surrendered Secured personal property
• Medical Debt
• Credit Card Debt
• Loans
• Judgments in lawsuits *

To qualify for a Chapter 7 filing the debtor may be an individual, a partnership or a corporation. 11 U.S.C Sec. 101. Subject to the means test and other statutory concerns (have not received a discharge from bankruptcy in the last eight years) relief is granted to individuals irrespective of the amount of the debtor’s debts.

The process of a Chapter 7 case usually begins with the debtor filing a petition with the bankruptcy court. Once the petition is filed the automatic stay comes into effect. The automatic stay stops any legal action or collection process from going forward. The petition is comprised of schedules, statements and declarations. The schedules include a listing of assets and liabilities, creditor information, income and expenses, contracts and leases. Statements include statements of financial affairs and Declaration about the debtor’s intention, credit counseling compliance and social security number.

The debtor must provide 6 months of pay stubs, two years of tax returns (federal and state) bank account information, car and title information, mortgage title and information (if applicable), listing of all creditors (including recipient of alimony and child support payments if applicable) and provide a copy of the credit counseling course.