What is Chapter 7 bankruptcy?
Chapter 7, or a "straight" bankruptcy, is the most common type of bankruptcy. It eliminates most unsecured debts and gives you a fresh start. Some debts, such as amounts owing to an ex-spouse under a divorce degree or divorce settlement, are not discharged in Chapter 7. Other debts, such as income taxes, may be discharged under certain circumstances. Student loans are not dischargeable, except in rare cases. Chapter 7 usually lasts approximately 60 to 90 days from the day you file the bankruptcy to the date you get your discharge. The Carmichael Firm have experience handling both simple and complex Chapter 7 bankruptcy cases. In Chapter 7, you are entitled to keep certain types of your property (known as "exemptions") up to specific maximum dollar values. The Carmichael Firm can provide to you a review of your assets and the exemptions available to you.
In a Chapter 7 bankruptcy, a Trustee is appointed to review your financial affairs and assets. The Trustee has the power to sell ("administer") assets not included in the allowed exemptions. If the Trustee determines that there are no assets available for him or her to sell, the case is reported as a "no asset" case and it is closed. The Bankruptcy Court will issue your discharge about 60-90 days later. Usually, all debts listed in the bankruptcy are discharged and the creditors are forever prohibited from trying to collect those debts from you.