Chapter 7 Bankruptcy
Shevitz Law Firm
What is Chapter 7 bankruptcy?
Chapter 7 bankruptcy is a type of bankruptcy protection that involves a liquidation of assets in exchange for a discharge or elimination of most debts.
Unlike Chapter 13 bankruptcy, there is no plan of reorganization and instead a Chapter 7 Trustee is assigned to the case to determine if any assets can be liquidated for the benefit of an individual or corporation’s creditors.
Will I lose all of my possessions through Chapter 7?
Many individuals are entitled to keep some or all of their assets in a Chapter 7 bankruptcy based on their eligibility of exemptions that may protect those assets.
Corporations are not entitled to a Chapter 7 discharge nor are they entitled to exemptions and they may find more benefit in a Chapter 11 bankruptcy.
Who is eligible for Chapter 7 bankruptcy?
Individuals that pass the Means Test and corporations are eligible to file Chapter 7.
The means test usually must be filed for individuals who file for Chapter 7 Bankruptcy. This test is used to help the Court or other interested parties to determine if an individual qualifies for Chapter 7 bankruptcy based on a combination of income and expenses.
There is no minimum debt limit requirement, similarly to how a Chapter 11 bankruptcy works.
Looking to reorganize your debt?
Individuals who wish to reorganize their debts, such as pay back mortgage arrears, may wish to reorganize under Chapters 13 or Chapter 11.
How do I know if Chapter 7 bankruptcy is right for me?
Although Chapter 7 bankruptcy is a very powerful tool, it is not always the best choice for everyone.
Speak with a Los Angeles Bankruptcy attorney today to determine if filing for Chapter 7 bankruptcy is the right option for you.