Chapter 7 bankruptcy is a viable option for people who have incurred unsustainable amounts of debt. This chapter in the bankruptcy code provides a way for an individual to get relief from unsecured debts. These debts are often imposed on the debtor as a result of an unexpected emergency like an unaffordable medical procedure, high-interest payday loans and ballooning mortgage payments.
Asset Sales, Chapter 7 Bankruptcy
Under this section of the bankruptcy code, the creditors will receive payment for the debts owed to them through a sell of the debtor’s qualified assets. Certain kinds of property will not be taken from the debtor, and an experienced bankruptcy attorney can help debtors understand these issues in great detail.
Potential Benefits of Chapter 7 Bankruptcy
Anyone who is being pursued by creditors might benefit from the protections offered under Chapter 7 bankruptcy. Creditors may attempt to garnish wages or seize property through legal proceedings. Credit card debt is often unsustainable, and unaffordable medical bills often drive people to examine bankruptcy as a viable option for implementing a long-term financial strategy. After filing a successful Chapter 7 bankruptcy petition, these bills can be terminated within only a few months; however, each situation is different, so a qualified bankruptcy lawyer should be consulted in order to answer any questions related to specific cases.
Risks and Consequences
The decision to file Chapter 7 bankruptcy is a serious one, so many people prefer to consult a professional bankruptcy lawyer before continuing the process. The court will examine the bankruptcy petition carefully in order to determine if the request is legitimate. Abuse of Chapter 7 bankruptcy is not uncommon, so each application should be prepared according to the principles guiding the intent of the law. Individuals who are considering filing for bankruptcy should use the proper code, for Chapter 7 is not always the best option for individuals who are dealing with a home foreclosure.
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