How To Guide: Chapter 7 Bankruptcy

How To File Chapter 7 Bankruptcy

Dealing with debt is scary. Contemplating filing bankruptcy can be even scarier. While a bankruptcy lawyer can’t eliminate the fear bankruptcy and debt bring, we can provide comfort and guidance to help ease the process. Let’s take a moment to explore Chapter 7 bankruptcy and how to file Chapter 7 bankruptcy.

how to file chapter 7 bankruptcy

What is Chapter 7 bankruptcy?

In this type of bankruptcy, you will give up all your non-exempt assets in an effort to pay as many of your creditors as you can. The remaining debts will be discharged. In a Chapter 7 bankruptcy, you will also have asset exemptions that will allow you to shield your most important assets.

Now that you know what Chapter 7 bankruptcy is, you will need to decide if bankruptcy is right for you, as well as how to file Chapter 7 Bankruptcy.

Analyze your financials. Create a list of your assets, and your secured and unsecured debts. Afterwards, consider if you can restructure your finances to pay off debts through creative budgeting. If you can’t, bankruptcy may be a viable option for you. However, remember filing Chapter 7 bankruptcy will not wipe out your mortgage or your auto loans, but it will put a temporary stop to the collection process.

The first official step in filing Chapter 7 bankruptcy is completing a mandatory and accredited credit counseling program. California requires that all debtors complete credit counseling within 180 days before they file for bankruptcy protection.

If you complete credit counseling and still feel filing for Chapter 7 bankruptcy is the right decision, it is time to contact a bankruptcy attorney. A bankruptcy attorney will show you how to file Chapter 7 Bankruptcy.

Meeting With A Bankruptcy Attorney

Once you have met with your bankruptcy attorney and provided them with a complete set of your financials, your attorney will prepare the initial filing. The initial papers will detail all of your debts and various creditors as well as your assets, income, and living expenses. Immediately after filing the paperwork you will receive an automatic stay. The automatic stay will stop all debt collection calls, foreclosures, any collection lawsuits, wage garnishments and other debt collection procedures.

At this point the court will assign a bankruptcy trustee. The trustee will act as a mediator between you and your creditors and will manage your bankruptcy from start to finish. To do this the trustee will review your filing and determine if you have any non-exempt assets. They will also review your recent financial transactions to see if they can be removed.

Meeting of Creditors

The trustee will schedule a meeting of the creditors, approximately 21 to 40 days after your initial filing. During the meeting you will be sworn in and required to answer a variety of questions from both the trustee and your creditors.

After the meeting of the creditors, you first decide if you will surrender or keep your secured debts. Following that decision, you will be required to surrender all non-exempt property to the trustee so they may proceed with selling it and paying off your creditors. When this is complete, your remaining unsecured debts will be officially discharged and you will begin the recovery process. Bankruptcy recovery can take anywhere from a year to seven years, so make wise choices and seek guidance whenever you are unsure.

About Marc Aaron Goldbach

Marc Aaron Goldbach has worked tirelessly to develop a successful bankruptcy and civil law practice for clients located throughout Los Angeles County. Mr. Goldbach at GoldBach Law Group have represented a wide array of small businesses and individuals with 100% client success rate. Mr. Goldbach is always available to answer questions and willing to guide you through the entire legal process.
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