Overview Of Chapter 7 Bankruptcy
If you are contemplating filing bankruptcy, it is important to know which type to file. Chapter 7 Bankruptcy, which is also known as “liquidation” is one of the most common types of bankruptcy filed today.
Chapter 7 is generally very simple. In short, assets are sold to provide creditors with necessary payment, and you become debt free. Although this is the most common type of bankruptcy filed, it is not always the best option for everyone.
To help you better understand if Chapter 7 is right for you, here are some examples of the types of concerns that may be resolved by filing.
Substantial Credit Card Or Medical Debt
When credit card or medical debt has become overwhelming, you may be a good candidate for Chapter 7 Bankruptcy. There are times when you simply cannot get out of this type of debt on your own. Chapter 7 Bankruptcy can help to eliminate these types of unsecured debts, helping you to quickly get back on your feet.
Exhausting Calls And Notices From Bill Collectors
When bill collectors start calling, they usually don’t stop. In fact, over time debt collectors generally become even more persistent, making it very difficult to focus on anything else. By filing Chapter 7 Bankruptcy, you become free from any collection efforts. Bill collectors are required by law to stop contacting you.
Minimal Amounts Of Property Owned
Depending on where you live, Chapter 7 Bankruptcy may not provide as much protection for your property as Chapter 13. However, with Chapter 7 exemptions, individuals are often able to keep the following:
- Home
- Cars
- Furniture
- Other valuables
Insufficient Funds To Pay Bills
Individuals who file Chapter 7 Bankruptcy are generally required to pass a “means test” that helps to determine actual need. If you are not sure whether or not you would qualify, your bankruptcy lawyer will help.
Poor Credit Scores
As you may already know, filing bankruptcy can negatively affect your credit score. However, if your credit score is already low, Chapter 7 Bankruptcy most likely won’t make a noticeable difference. In fact, most people find that filing bankruptcy is the only way to get out of a continuing credit score decline. After a 7-10 year period, bankruptcy is usually removed from your credit.
Conclusion
Chapter 7 Bankruptcy has helped many individuals get back on their feet. If you are unable to see a way out of current debt, it is time to take action.
To speak with an attorney about Chapter 7 Bankruptcy, please contact California Bankruptcy Relief at 888-748-0025.
