Bankruptcy Chapter 7
WE Legal, APC in Riverside
Chapter 7 bankruptcy is part of a larger set of laws known collectively as Title 11, or the Bankruptcy Code. It provides a safety net for those who are deep in unsecured debt, such as credit cards, medical bills and personal loans. It is most often used by individuals hoping to start off on a new foot as quickly as possible. Chapter 7 can be seen as a do over solution to financial crises. It provides a “Fresh Start” for qualified debtors.
In a Chapter 7, a debtor is able to technically liquidate all non – exempt assets and start over. The goal is to stop the phone calls from debt collectors and regain peace of mind.
This type of debt elimination, however, usually comes from liquidating personal property with the exception of exempt items. Generally, these exempt items include some equity in your home, car, cash from Social Security, important business tools among others. The cash generated from the sale of non-exempt assets, of either a person or a business, then goes to the creditors until the debt is paid or there are no more usable assets.