The Chapter 7 Bankruptcy

Author: JoeMacker Total views: 5 Word Count: 428

Chapter 7 bankruptcy is one type of bankruptcy that is available for people to file under the Bankruptcy Code. This form of bankruptcy is not available to everyone. Only certain people can file this type of bankruptcy and only people in certain situations should someone file this type of bankruptcy.

Who Can File Chapter 7 Bankruptcy?

Wondering who can file for Chapter 7 Bankruptcy? Well, it is only available to individuals and some businesses. Assets need to be limited to those that can be claimed as exempt in order to file for Chapter 7 bankruptcy.

In some cases, though, Chapter 7 may be best even if someone has more assets. The court, though, may rule that a person can not file a Chapter 7 if their assets are high enough to clear their debt.

The Process

The process of filing for bankruptcy involves a lot of steps. Firstly, you need to collect all information about your financial situation. Next you may be required to attend counseling which helps you to decide if filing bankruptcy is the best option.

After going thought this first phase, you will then be able to start filing out the proper forms and filing them with the court. After this, you are required to attend court to plead your case. This will be done over the next few months.

The whole process can last quite some time, but during the process you are protected from debt collection by creditors.

Any Risks Involved?

If you think bankruptcy is an easy way to clear your debts, think again. Recent changes in the bankruptcy laws has made filing bankruptcy more difficult and in some cases impossible.

You are at risk of losing your assets because they can be taken to repay debts. You are also going to end up with a damaged credit record. The effects of a bankruptcy can last seven to ten years and can really hurt your ability to get loans and other forms of credit in the future.

New laws may require you to file a Chapter 13 instead of a Chapter 7 if your income is deemed to be more than the set amount. The court can decide that a repayment plan is better for your situation instead of actually clearing your debts.

Bankruptcy should not be looked at as a way to get out of your financial obligations because you will end up paying in the end in some way. Additionally, not every debt can be cleared through bankruptcy. If you take the process seriously then you should end up with the result you desire.

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About the Author

Facing possible bankruptcy? Now find out more about Bankruptcy and how it will affect you and your family. Read and find out more about bankruptcy by going to this website ==> http://www.outofbankruptcy.info

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