How Does Chapter 7 Work?
A Chapter 7 is typically filed with the US court in the district in which the client resides. Your petition should include a list of all your assets and debts. Many debts under the U.S. bankruptcy code can be wiped out by filing for Chapter 7. In a successful Chapter 7 bankruptcy petition, ideally all of unsecured debts will be legally discharged and completely eliminated. The most common type of debts would include:
- Credit card debt
- Medical bills
- Personal loans
- Business loans
Certain types of debts however, are not eligible to be discharged through Chapter 7. Any outstanding child support payments, student loans, tax debts, restitution or debts related to criminal charges cannot generally be discharged.
In order to be found eligible for Chapter 7, you will need to pass what is known as the means test. You must take what is known as a credit counseling seminar within 180 days before filing your petition.
The benefit of filing for Chapter 7 is that once your petition is entered you are protected under the "automatic stay." This makes it so that creditors are no longer permitted to pursue collection actions against you. As long as the automatic stay is in effect, creditors cannot contact you, demand payments, cannot continue with lawsuits and must cease all wage garnishments.
Experienced Chapter 7 Bankruptcy Counsel in Hackensack
Many applicants are unaware of the U.S. Bankruptcy Code and the requirements for each type of bankruptcy. Good Faith debtors have the legal right to debt elimination, the point of bankruptcy is to giving an honest individual a fresh start when they truly need it. Correctly filling out the petition is a crucial step in the bankruptcy process, if you forget to list all of your debts in the petition, then the ones that are missing may not be discharged through the bankruptcy. The bankruptcy process can be confusing and overwhelming to those that are not familiar with the laws and deadlines. With the help of a bankruptcy attorney in Northern New Jersey, your Chapter 7 case can run smoothly and the firm can help ensure that no stones are left unturned. Attorney Marc Alster has extensive experience and a deep understanding of bankruptcy law, call (201) 878-4630 today to schedule a free initial consultation!