Chapter 7 Bankruptcy- The Process Involved
By: Jay King | Posted: 19th October 2010
Chapter 7 Bankruptcy is more of a liquidation that involves a debtor’s non- exempt or non-excusable assets. These can be sold by the trustee to pay back the creditors as per the priorities that are established within the chapter’s code. The eligibility of a debtor to choose Chapter 7 bankruptcy is completely determined with the incorporation of a Means Test. Chapter 7 is probably the quickest and simplest forms of bankruptcy filing and it is available primarily to individuals. Furthermore, what makes this form of bankruptcy so simple is its ability to consider assets as exempt, thus denying any liquation of the assets to the creditors.
The case begins with an official petition filing, statement of the financial affairs as well as the schedules. During this period, a debtor is required to list out their assets alongside the debts that they have incurred. Besides, it is equally important to mention the list of creditors from whom the debtors have been extended credited. The list should also include any property, debts that have been secured on that property, as well as its current sales value. Property includes any of the assets belonging to the debtor and not just necessarily real estate. After this process, the list has to be signed by debtors. Meetings of the creditors take place after the listing. This part of the Chapter 7 ensures that the trustee as well as creditors can have a clear view upon the number of debts and assets that the debtor holds.
After this first meeting, the trustee reviews the debtor’s income to ensure that the person will be capable of living at their current rate of expenses. The only job of a debtor is to make sure they offer appropriate and timely information to the trustee as and when required. The trustee and the creditors have a period of 60 days with them in order to decide whether they would want to challenge the right of the debtor to discharge. If the creditors do not incline to challenge a debtor’s discharge, individual debtors are given the discharge from any of the dischargeable debts.
Again Chapter 7 Bankruptcy is considered the easiest and today is the most popular form of bankruptcy filed in the United States. To see if you are eligible for a Chapter 7 Bankruptcy consult with local Bankruptcy Attorneys. Only licensed Bankruptcy Lawyers can thoroughly review the bankruptcy process with you and determine eligibility factors based on the individual parameters of your unique situation.
Jay King is owner of BankruptcyIntro.com. We've all heard of large companies filing for bankruptcy or "going bankrupt" and most of us would think that particular company must be in trouble.About the Author
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Tags: job, real estate, priorities, debts, assets, chapter 7 bankruptcy, incorporation, creditors, bankruptcy filing, trustee, petition, liquidation, debtors, financial affairs, current rate, first meeting, means test