What is Chapter 7 Bankruptcy? – Tips for Filing Chapter 7

by | Mar 5, 2012 | Legal Advice

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For several local residents, filing for bankruptcy protection through Chapter 7 in Turnersville is a great tool to help get you back on your financial feet. Whether it is due to job loss, health issues, or due to economic downturn over the past few years, many Americans are finding it harder than ever to repay debt they have acquired over previous years. By filing Chapter 7 bankruptcy, you can protect yourself from the never-ending phone calls from creditors and start fresh with a new financial plan for the future.

What is Chapter 7 Bankruptcy?

Chapter 7 Bankruptcy is the same in Turnersville as it is in any other city in the United States. The Federal Government allows individuals to petition the court to discharge debts they have established over the years. In exchange however, the Federal Government has the right to liquidate any assets you own, which is not exempt from collection proceedings and distribute the profits of these sales to your creditors.

The debtors have rights to protect individual property which is off limits to creditors, but these mandates are bound by individual state bankruptcy codes. This is why when you file Chapter 7 in Turnersville, a local, seasoned and professional bankruptcy lawyer can help you understand this process better.

Who can file for Chapter 7?

Chapter 7 Bankruptcy is not available to all individuals. Recently the United States Federal Government has enacted changes which provide specific requirements individuals need to qualify for Chapter 7 protection. All those who do not qualify under these standards will be required to file Chapter 13, which is a debt payment program as opposed to total debt liquidation.

Who is best suited to file Chapter 7?

Chapter 7 filings are best suited for people who have very little household income. In order to qualify for Chapter 7 protection, all debtors are required to take and pass a means test which examines individual finances in order to provide the best course of action. People who do not own property or large portions of property are better suited to file Chapter 7. Individuals who have very large unsecured debts also are more qualified to file for Chapter 7 protection.

Chapter 7 Bankruptcy protection is a process which quickly dissolves many unsecured debt like major medical expenses and credit cards. Under Federal Law, creditors have the right to request that assets can be sold in order to pay them back a portion or your entire amount owed. This is why sometimes, individuals who own large portions of property are best suited to file for Chapter 13 protection. Chapter 7 is best suited for individuals who have acquired large portions of debt, have very little household income or property to liquidate in order to repay debt.

Filing for Chapter 7 Bankruptcy protection is a rather complicated process and hiring a local attorney who specializes in filing Chapter 7 in Turnersville is a smart choice to ensure this process is handled smoothly, expeditiously and affordably.


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