Chapter 7 Overview

Considering filing for bankruptcy? Unsure whether to file a Chapter 7 or Chapter 13? Perhaps you are not even quite sure what the two types of bankruptcies entail, and how they are different.

 

Costs and Duration

A typical Chapter 7 bankruptcy case costs approximately three hundred dollars in various filing fees and other costs, and lasts on average six months or less. You must undergo a credit counseling session with an approved agency before you file.

Eligibility for Chapter 7

Eligibility is based on your income level and is determined by a method called the “means test.” If you qualify based on this test, you will fill out a number of forms outlining your personal finances, debts, and property, which will then be used to determine what debts will get repaid, what property you are able to keep, and more.

One of Chapter 7’s biggest benefits is the automatic stay. This provides a measure of protection for you from your creditors, who cannot undertake any further collection action after you file Chapter 7. The automatic stay prevents creditors from continuing to harass you for collections while the bankruptcy process is underway, providing some breathing room for many debtors.

At the end of the bankruptcy process, many of your remaining outstanding debts are discharged. Not all debts are discharged through bankruptcy, of course, and there are many complicating factors. A Tampa bankruptcy attorney will be your best guide through the waters of Chapter 7 bankruptcy.



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