Chapter 7

What is Chapter 7?


 

Chapter 7 filings are commonly known as the “straight” bankruptcy.  These filings are for the traditional liquidation of personal, business or partnership assets. Generally, the types of liabilities that may be extinguished include, but are not limited to:
  • Medical bills
  • Credit Card Debts
  • Judgments (in cases not involving fraud or criminal conduct)
  • Personal loans or debts
  • Deficiencies on foreclosed properties or repossessed vehicles
By extinguishing these debts, you will, in effect, get a fresh start.  In addition, you are able to stop a foreclosure or repossession.

Filing Chapter 7


 

You will usually be able to keep all of your property, including your house and vehicle as long as you are current with your payments and able to continue to make these payments.  In a Chapter 7 case, you can keep all property which the law says is “exempt” from creditors.  In Michigan, the list of exempt property includes, among other things, a decent portion of equity in your home, qualified retirement accounts, equity in your car, all Social Security benefits, and many other assets.

Not Everyone is Elgible


 

Filing for Chapter 7, however, is not allowed for all persons seeking to file Bankruptcy.  In order to determine if you are eligible, please contact our office to arrange a consultation on which type of Bankruptcy is right for you.  A Chapter 7 Bankruptcy can be completed in approximately 90 days, but may take longer depending on your situation.
Chapter 7

Why Choose Chapter 7 Over Chapter 13…


 

If you do not have a sufficient amount of income to over your basic, everyday expenses and therefore cannot afford to make the monthly payments toward your debt, you may want to consider Chapter 7.  Chapter 7 does not involve setting up a repayment plan.  It simply discharges your debt.
 
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