Chapter 7 bankruptcy is utilized by persons who wish to eliminate their debt and obtain relief from future obligation regarding those debts.  In a Chapter 7 bankruptcy, the debtor requests that the Court liquidate all non-exempt property to pay creditors.  In addition, the debtor may choose to remain in possession of items such as homesteaded property or an automobile.

The entire Chapter 7 bankruptcy process takes approximately four to six months to complete.  There is a filing fee.

It is recommended that you obtain an up-to-date copy of your credit report prior to filing bankruptcy. 

Filing bankruptcy places into effect an automatic stay.  This immediately stops your creditors from attempting to collect on your debt.  The automatic stay also stops garnishment and foreclosure proceedings, at least temporarily.

The bankruptcy court appoints a Trustee to oversee your case.  The Trustee's main interest is any non-exempt assets you own that may be liquidated in order to pay your creditors.

Shortly after filing the bankruptcy petition, you will be notified of a Creditors' Meeting, which you must attend.  This is a brief meeting conducted by the Trustee to determine whether you have any assets which may be seized or surrendered.

Generally, secured debts, such as homesteaded property and motor vehicles, may be "reaffirmed" if you continue making payments.

Some debts that are nondischargeable in bankruptcy are:

~ debts not listed on the bankruptcy petition

~ child support and alimony

~ student loans

~ income tax debt

After the bankruptcy process is over, most of your debts will be "discharged" or wiped out, meaning you will no longer be legally liable for payment of the discharged debts. 

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