What is Chapter 7 bankruptcy?
- Chapter 7 bankruptcy, or “liquidation” bankruptcy, is designed to give you a fresh start. A bankruptcy trustee will sell any nonexempt property to repay creditors. In return, you get a fresh start. Typically, people have very little property that is not exempt. Most Chapter 7 bankruptcy filers end up keeping most or all of their property.
Will all of my debts be wiped out with a Chapter 7 bankruptcy?
- Most unsecured debts, or debts not associated with property like a home or car, are wiped out in a Chapter 7 bankruptcy. Unsecured debts can include medical bills, credit cards, and other debts. Some unsecured debt cannot be wiped out. Child support, student loans, and tax debts are some of the debts that will not be wiped out.
Can a Husband and Wife File Jointly?
- A husband and wife may file a joint case under Chapter 7. However, both husband and wife must receive the required credit counseling before the case is filed and both must complete the required financial management course after the case is filed. A husband and wife should file a joint Chapter 7 if both of them are liable for one or more significant debts. If only one spouse files, a creditor may later attempt to collect the debt from the non-filing spouse.
Will I be able to Keep my Car?
- In many instances you will be able to keep your car. Depending on the value of the car and the nature of the lien you may be able to make an agreement that will allow you to keep you vehicle.
Will I be able to Keep my House?
- Many houses have certain exempt values. These coupled with the security or lien interest may allow you to keep you house. Much depends on the status of the payments and the nature of the security.
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