CHAPTER 7 BANKRUPTCY


15 May

CHAPTER 7 BANKRUPTCY IS MORE THAN LIKELY THE MOST POPULAR BANKRUPTCY IN THE UNITED STATES.  CHAPTER 7 BANKRUPTCY HAS ALSO BEEN TERMED "LIQUIDATION BANKRUPTCY."  IN CHAPTER 7, THE MAJORITY OF A PERSON'S DEBT IS ABSOLVED WHEN THE BANKRUPCY IS DISCHARGED.  DEBTS THAT CAN BE DISCHARGED INCLUDE, BUT ARE NOT LIMITED TO, CREDIT CARD DEBT, MEDICAL BILLS, MORTGAGES AND OTHERS.  MONEY THAT IS OWED TO EDUCATIONAL INSTITUTIONS OR THE FEDERAL GOVERNMENT MAY NOT BE DISCHARGED.

IF A PERSON WANTS TO QUALIFY FOR CHAPTER 7, THE PERSON MUST PASS A BANKRUPTCY MEANS TEST.  THIS DETERMINES HOW MUCH DISPOSABLE INCOME HE OR SHE HAS AVAILABLE.  TO QUALIFY, THE DEBTOR'S INCOME MUST BE AT OR BELOW THE STATE MEDIAN.  THE DEBTOR IS ALSO REQUIRED TO COMPLETE A CREDIT COUNSELING COURSE WITHIN 180 DAYS OF FILING FOR BANKRUPTCY.

IN CHAPTER 7, THE COURT HAS THE POWER TO REPOSSESS AND SELL THE DEBTOR'S PROPERTY.  COLLECTED FUNDS ARE DISTRIBUTED TO THE PERSON'S CREDITORS.  THERE ARE ALSO TYPES OF EXEMPT PROPERTY LIKE RETIREMENT ACCOUNTS, EYEGLASSES, MEDICAL EQUIPMENT AND HEARING AIDS, CEMETARY PLOTS AND A FAMILY BIBLE.

WHEN YOU GO SEE YOUR BANKRUPTCY ATTORNEY, YOU NEED TO BRING THE FOLLOWING:  (1) A LIST OF ALL ASSETS AND PROPERTY; (2) A LIST OF ALL CREDITORS; (3) A LIST OF ALL SOURCES OF INCOME; AND (4) A DETAILED LIST OF MONTHLY LIVING EXPENSES.

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