Chapter 7

Helping People Achieve Peace of Mind Through a Financial Fresh Start

Chapter 7

Chapter 7  | Rodney S. Scott Attorney Law  - Longview, TX

Do you find yourself drowning in debt? Are your repayments adding up to more than you earn? If so, a Chapter 7 bankruptcy may be the solution to your worries. This type of bankruptcy allows you to get a FRESH START and prevents most creditors from being able to take further actions against you. Chapter 7 bankruptcy may also wipe out certain debts completely.

In a bankruptcy case under Chapter 7, you file a petition asking the court to discharge your debts. It requires an individual to give up property which is not ‘‘exempt’’ under the law, so the property can be sold to pay creditors. Generally, those who file Chapter 7 keep all of their property except property which is very valuable or which is subject to a lien which they cannot avoid or afford to pay.

If you want to keep property like a home or a car and are behind on the mortgage or car loan payments, a Chapter 7 case probably will not be the right choice for you. That is because Chapter 7 bankruptcy does not eliminate the right of mortgage holders or car loan creditors to take your property to cover your debt.

Higher-income consumers must fill out “means test” forms requiring detailed information about their income and expenses. If the forms show, based on standards in the law, that they have a certain amount left over that could be paid to unsecured creditors, the bankruptcy court may decide that they cannot file a Chapter 7 case, unless there are special extenuating circumstances.

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