The Ins And Outs Of Ch 7 Bankruptcy
If you are having extreme financial difficulties and experiencing harassment from your creditors, you may need to consider bankruptcy. Ch 7 bankruptcy is considered liquidation of non-exempt assets. In other words, some of your assets are sold for cash to pay off your existing debts. However, many times, debtors do not possess any non-exempt assets.
Most states normally exempt assets such as the debtor's home, furniture, home furnishings, cars and clothing up to a certain amount. For example, if you are single the amount could be up to $30,000, and if you are married, it could be up to $60,000. In other words, if you file Ch 7 Bankruptcy, you should be able to keep your home, cars and furniture. However, you will still need to make payments if they are owed.
The qualifications for filing Ch 7 Bankruptcy have changed. In 2005, George Bush, put a law into effect that changed the wording of bankruptcy law. It had to do with abuse of filing bankruptcy. It has made it more difficult for certain debtors to prove that they qualify for Ch 7 Bankruptcy.
If you do qualify for bankruptcy, be advised that the process can move along at a fairly quick rate. However, there are many steps that you need to successfully and honestly complete in order to secure your Ch 7 bankruptcy claim. The first step to take when filing any type of bankruptcy is to file a petition with the bankruptcy court. Once that is done, then you must provide all sorts of information to the court about your debts, assets and income. You need to make a full disclosure of all of your debts, assets and income. Failure to fully disclose the details of your financial situation can result in you being charged with bankruptcy fraud. One benefit of filing bankruptcy is that it affords you protection from your creditors. Once you have filed, usually your creditors, by law, must stop contacting you and asking you for payment. Your creditors are notified by the Ch 7 Bankruptcy court that you have filed bankruptcy and they must recognize that fact. Be advised that one of the conditions of filing Ch 7 bankruptcy and discharging debts is that you complete some education about how to manage your personal finances. It is important that you are informed of the steps you need to take in the future to manage your personal debt. If you are concerned about the cost of filing bankruptcy, you should know that there is a filing fee of several hundred dollars. Then, you will incur attorney's fees. However, many Ch 7 bankruptcy attorneys will try to make their services as affordable or cheap as possible for their bankruptcy clients.
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