Is Chapter 7 Bankruptcy Right for You?
When you find yourself in financial distress, hounded by phone calls from creditors, and unable to pay loan and credit card payments, it can be difficult to know where to turn for help — whether that’s a bankruptcy attorney or a debt relief agency. With our free 30 minute initial consultation, an experienced bankruptcy attorney can explain how the Chapter 7 bankruptcy option might work for you given your own unique debt and income situation.
Chapter 7 bankruptcy, also known as liquidation bankruptcy or straight bankruptcy, gives debtors the advantage of getting their debts erased under the federal court, but that’s after releasing their expensive assets as collateral. Chapter 7 bankruptcy law provides an avenue to erase unsecured debts, including credit card debts, personal loans, and medical bills. Not every type of debt falls under this type of bankruptcy.
Chapter 7 Attorney John E Dunlap serves clients in the Greater Memphis, Tennessee area to file for Chapter 7 bankruptcy and start life again debt-free. We offer a free 30 minute consultation to review your finances, make sure you understand the bankruptcy process, and help you get started with your bankruptcy filing.
If you’re looking for a local chapter 7 bankruptcy attorney who can help you navigate filing for bankruptcy, call our bankruptcy law firm today. With over 20 years of experience, we have handled hundreds of Chapter 7 bankruptcy cases to help our clients rebuild their personal finances, recover from debt, and start life fresh.
What is Chapter 7 bankruptcy?
In a Chapter 7 bankruptcy, all of your nonexempt assets are liquidated and used to pay your creditors, who will then cancel the balance of most or all of your debts. This is also referred to as a “straight” or “liquidation” bankruptcy.
In 2016, over 490,000 people filed for Chapter 7 bankruptcy, many of whom were helped by a local bankruptcy attorney. Over 62% of bankruptcies filed are Chapter 7 bankruptcies.
Experienced bankruptcy lawyer John E. Dunlap helps clients file bankruptcy by:
- Help you use the right kind of bankruptcy for your financial situation and understand the benefits of a Chapter 7
- Determine if you’re eligible to file a Chapter 7 through the means test
- File for Chapter 7 bankruptcy with the courts and prepare necessary documents for bankruptcy
- Handle meetings with creditors, called 341 meetings, and help you tackle other required financial and credit counseling
- Help you discharge debts in as little as 4 months
What Debts Cannot Be Forgiven In Chapter 7 Bankruptcy?
With Chapter 7 bankruptcy, you won’t be eligible for relief from certain types of debt. Debts such as student loans, child support, or alimony will not be forgiven under this type of bankruptcy.
Filing Chapter 7 bankruptcy if you have secured debt, meaning loans that are tied to collateral, is also not advised. The secured debt can be wiped out, but the property used as collateral — such as cars — can still be reclaimed by the creditor. Your bankruptcy lawyer can advise you on how to file for bankruptcy and still keep your car. You may have the option of paying fair market value for the property, or continuing to make payments.
Also, discharge of debt doesn’t apply to taxes, court fees, non-dischargeable debts, overdue condominium fees, wrongful death penalties, personal injury damages, government-based fines, and debts linked to your retirement accounts.
What Debts May Be Forgiven Under Chapter 7 Bankruptcy?
If you face creditor harassment in Shelby County and you file for bankruptcy through the assistance of qualified Memphis bankruptcy lawyers, you may be eligible for bankruptcy relief if your form of debt falls in any of the following categories:
- Civil court judgments
- Veteran assistance overpayments and loans
- Unpaid taxes and tax penalties that fall within a certain period
- Overdue fines associated with auto accident claims
- Utility bills and violated checks
- Loans given by relatives, friends, or employers
As with much of bankruptcy law, it can be tricky to know what debts can be discharged and which cannot. Experienced bankruptcy attorneys like John E. Dunlap can advise you of your options based on your unique situation.
Who Does Bankruptcy Chapter 7 Benefit?
Whatever your individual situation or credit report, Chapter 7 bankruptcy may be of benefit to you. This bankruptcy law chapter is ideal for people who have assets they can part with and lack the ability to pay for their loans.
Through this type of bankruptcy option, you can give up your assets to have your creditors paid and your loan wiped away. Working with Chapter 7 bankruptcy lawyers can help you rebuild your credit score, avoid creditor harassment, and gain debt forgiveness.
If you think filing bankruptcy may be the right option for you, contact us today to learn more about the process.
We offer free 30 minute consultations to new clients. If you’re unsure if Chapter 7 is the right kind of bankruptcy or want to learn more about your options, call us today to schedule your appointment at no cost to you.
What is the process of filing for a Chapter 7 Bankruptcy?
There are nine basic steps when it comes to the process for filing chapter 7. An experienced bankruptcy attorney can help you through each one of these steps by providing support, legal knowledge, and act as a negotiator on your behalf with creditors.
- Complete Required Chapter 7 Credit Counseling
- Take the Chapter 7 Means Test
- File Chapter 7 with the Court
- Meet with Bankruptcy Trustee
- Notify Creditors of Chapter 7 Bankruptcy Case
- Complete 341 Hearing
- Chapter 7 Abuse Determination
- Complete a Financial Management Course
- Chapter 7 Debt Discharge
To learn more about the process, be sure to read through our breakdown of the Chapter 7 filing process.
Am I eligible for a Chapter 7 Bankruptcy?
Not everyone qualifies to file a Chapter 7, particularly those whose disposable income is deemed to be high enough to continue payments on a portion of their debt, as determined by the Chapter 7 Means Test. This test assesses your current monthly income and compares it to your expenses to arrive at your “disposable income.”
If this income is deemed sufficient to pay back at least a portion of your debts, you may be required to file a Chapter 13 bankruptcy. But if this income is too low, or if your gross monthly income is below the Tennessee Median Income for your family size (e.g. $63,725 for a family of 4 in 2014), you may be eligible to file a Chapter 7.
How could a Chapter 7 Benefit Me?
However, eligibility does not necessarily mean that Chapter 7 is right for you. For example, if you have a co-debtor on a personal debt, bankruptcy will not wipe out his or her obligation to pay – and the creditor may go after this friend or family member. In addition, some debts, such as student loans and tax obligations, are not eligible for dismissal under Chapter 7.
Before you decide to file for bankruptcy, seeking legal counsel can help you understand the difference between the various filing methods and their ramifications on you, your family, your business, and any cosigners or guarantors for your debts. Attorney Dunlap has over 20 years experience in bankruptcy law and can explain the process in plain English, while helping you navigate through the experience from beginning to end.
How long does a Chapter 7 Bankruptcy take?
Most bankruptcy cases take less than 100 days to close after filing with the courts. This means that most people who file Chapter 7 are debt free in as little as 100 days, ready to get on with life after bankruptcy. It’s one of the many benefits filing for Chapter 7 can provide when you’re drowning in debt.
What documentation do I need to file chapter 7?
Working with an attorney to file your Chapter 7 bankruptcy can make it much easier to gather together the documents you need to file for bankruptcy. With up to 30 forms and documents required to file bankruptcy with the courts, it can be a difficult process to navigate on your own.
As part of working with bankruptcy attorney John E. Dunlap, we’ll ask for a number of documents and some paperwork that helps us prepare our clients’ Chapter 7 filing paperwork. To learn more about what documents you may need to provide, check out our list of what we typically need to help our clients file Chapter 7 bankruptcy.
We offer free 30 minute consultations to new clients. If you’re unsure if Chapter 7 is the right kind of bankruptcy or want to learn more about your legal options, call us today to schedule your appointment at no cost to you.