Don't Let Debt Defeat You: Chapter 7 Bankruptcy Can Provide a Fresh Start
If you're plagued by debt, filing Chapter 7 bankruptcy may be the most effective way to protect yourself from creditor harassment and start afresh.
The vast majority of consumers opt for Chapter 7, where you immediately eliminate most of your debts, surrender any nonexempt assets (those that can be sold for the benefit of creditors) and go merrily on your way.
Chapter 7 probably is your best choice when all the following statements are true:
- You don't have many assets that you'd have to surrender to a trustee
- You're current on home and car payments, or willing to surrender them to the trustee
- You don't have much money left over each month after paying expenses
- You haven't received a bankruptcy discharge in an earlier case filed within the past eight years
Advantages of a Chapter 7 filing
Chapter 7 which is occasionally referred to as straight bankruptcy, is where most of your debts are completely eliminated and some of your property goes to creditors. There is no repayment, you go to court once and in 6 to 8 months or so you're done. Most consumer cases fall into the category of no-asset cases, where you get to keep most of your possessions.
Disadvantages of a Chapter 7 filing
The law is not about to let you bounce from one spending spree to another with bankruptcy functioning as your way out. If you file for bankruptcy today and the debts are discharged, you can't file again for another eight years. So, to file for bankruptcy, you need a lawyer who can walk you through the complicated process.
Another obstacle to Chapter 7 filing is the Means Test. This is a complex set of calculations used to identify whether you could pay a significant portion of your bills and should be required to do so. The Means Test does not apply to debtors earning less than the State median income though.
In addition to your ability to pay, some bankruptcy judges also consider whether you're acting in good faith. They may ask whether:
- Your bankruptcy was necessitated by sudden illness, calamity, or unemployment
- You made unnecessary eve-of-bankruptcy purchases far exceeding your ability to repay
Your bankruptcy paperwork is complete and accurate
Contact a DuPage County Consumer Bankruptcy Lawyer
To learn more about Chapter 7 bankruptcy and whether it may be right for you, call 630-296-5084 or contact our Naperville law firm online.