By the time you finish reading this, you will know the important point of Chapter 7 bankruptcy. If you are thinking that everyone can file for this type of bankruptcy, you are wrong. Only certain people can file for Chapter 7 bankruptcy. Well, if you are wondering who, you should read on.
Who Can File Chapter 7 Bankruptcy?
Wondering who can file for Chapter 7 Bankruptcy? Well, it is only available to individuals and some businesses. Assets need to be limited to those that can be claimed as exempt in order to file for Chapter 7 bankruptcy.
Even though sometimes the court may rule that a person is not able to file a Chapter 7, at times, it may be one of the best moves you can make.
The Process
The process of filing for a Chapter 7 may be long as you are required to collect all the information about your debts and your financial situation. Other than that, you're also required to meet with a counselor and attend counseling.
After this is done, you will then stat filling up some forms. After filling up the forms, you have to attend court to plead your case. The decision will be up to the court.
As you can see, this is quite a long process. However, you do not need to worry because as long as you are still undergoing the process, you are protected from debt collection by creditors.
What are the Risks?
Thinking of an easy way out to settle your debts? Count filing for Chapter 7 out. This should be your last resort as recent changes in the bankruptcy laws have made bankruptcy almost impossible.
You are at risk of losing your assets because they can be taken to repay debts. You are also going to end up with a damaged credit record. The effects of a bankruptcy can last seven to ten years and can really hurt your ability to get loans and other forms of credit in the future.
It is a good thing there is Chapter 13. You can file a Chapter 13 instead of a Chapter 7 if your income is deemed to be more than the set amount. So how do you pay back the amount? Well, the court can decide a repayment plan for you!
Now its time to put the knowledge to the test! You should always remember that bankruptcy is not an easy way out. And if you are serious about filing for Chapter 7, you need to be prepared for the consequences.
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