Chapter 7 Bankruptcy

Chapter 7 bankruptcy is also known as simple bankruptcy or liquidation plans. In a Chapter 7 case, Atlanta bankruptcy lawyers show you’re unable to pay the debts you have based on your income and expenses. In a Chapter 7 case, your debt is completely discharged. When the case is over your debt no longer exists. It’s gone.

What Chapter 7 bankruptcy does:

• Liquidates – or sells – any non-exempt property you may have to pay to pay creditors

• Eliminates most unsecured debt like credit card bills and medical expenses

• Provides Automatic Stay protection to you against lawsuits, collection actions, foreclosure, and repossession

• Gives you a fresh financial start

Chapter 7 bankruptcy seems simple in theory. However, with the changes in bankruptcy laws, you are now required to qualify for Chapter 7. Anyone filing Chapter 7 must take and pass a Means Test which determines if your income falls within set standards. Nor is all debt discharged through Chapter 7 bankruptcy. Debts arising from student loans, child or spousal support, taxes, drunk driving convictions, or other intentional acts are considered Priority Claims and are not discharged.

Secured debts – debt tied to collateral like a house or car – are not discharged in Chapter 7 bankruptcy. If the property is non-exempt, it may be sold to pay creditors at least some of what is owed. You may have the opportunity to reaffirm – or agree to new terms of the loan – the debt and remain current on the payments.

If you believe you qualify for Chapter 7 bankruptcy, consult a qualified Atlanta bankruptcy lawyer. Your attorney will work with you through the Means Test and help you determine what property you can keep.

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