Chapter 7 personal bankruptcy is the most common way for individuals to deal with the crush of unrepayable debt. Called liquidation bankruptcy or ‘straight bankruptcy’, Chapter 7 is a process organized under federal law to provide individuals and companies a way to discharge unsecured debts when they can’t be repaid.
Filing Chapter 7 bankruptcy is a good option when you have more debt than you can repay or too many creditors for debt settlement. Chapter 7 enables individuals to eliminate credit card debt, medical bills, judgments, personal loans and other types of debt for a fresh financial start. The principle advantage of filing Chapter 7 is it results in an often complete forgiveness of debt while protecting exempt assets.
In a Chapter 7 Bankruptcy, the debts from most mortgages and liens is not discharged as to the property. If a debtor wants to keep a house, car, and other items which are security for a loan, payments must continue to be made. Generally, to discharge a car loan without payment the debtor must surrender the car to the creditor.
In order to qualify for Chapter 7, the nature of the a person’s debts, income and financial situation is evaluated. If there’s a great deal of disposable income, a person cannot file under Chapter 7. The Chapter 7 bankruptcy process generally lasts three to four months, however rare cases can continue on for several years if the trustee is administering assets.
To discover how you can get a fresh start with Chapter 7 bankruptcy or Chapter 13 or Chapter 11, call for a free consultation. Curtis, Casteel & Palmer, PLLC has helped hundreds of good people overcome financial hardship in Lynnwood and Snohomish and north King Counties.
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