We have all heard of chapter 7 bankruptcy, although many of us if asked probably could not give a precise answer to what exactly it entails. Sadly many folks make dreadful errors in their bankruptcy filing because of this lack of explanation.
Having to go through the proceedings necessary in bankruptcy is the last thing people want to do. Naturally the idea of being in a situation where your debts are worth more than what you earn is not very popular, however neither the less if you are in this situation making sure you understand what’s involved in Filing For Chapter 7 Bankruptcy is one hundred percent needed.
Numerous kinds of bankruptcy proceeding exist including but not limited to chapter 11 and chapter 7.
Defining chapter 7 bankruptcy for all
When somebody goes through the process of chapter 7 bankruptcy, according to United States of America law they are essentially liquidating all assets (that are not legally exempt from liquidation) so they can pay back their creditors.
Chapter 7 is an option open to individuals, businesses, partnerships and corporations. Chapter 7 bankruptcy is however different for individuals in that they have open to them a special extra clause in the bankruptcy filing framework.
This extra clause for the individual is commonly known as a discharge. What it basically means is that the public are able to free themselves totally from some of their debts.
Filing Chapter 7 Bankruptcy: Generally speaking to file a chapter 7 bankruptcy one mast supply the courts with copies of their: copies of tax returns; executed contracts and leases that have been expired; financial affairs statements; proof of assets and liabilities; and copies/schedules of current expenditures and income.
For the public there are a series of additional items that are necessary. These items include: copies of your reports for credit counseling as well as any payment plan programs, statements of income/employee payments and in the case of being a student, copies of documents stating interest payments on one’s student loans.
The information in this document is very brief and general, if you need to find out more about chapter 7 bankruptcy and others, a good place to start would be with the links in this article and also with the US courts website. However, remember filing for Chapter 7 protection by yourself is not advised, you should get professional help from a lawyer.
