The Bankruptcy practice our firm primarily handles is Chapter 7 bankruptcy. Chapter 7 bankruptcy is commonly referred to as Liquidation bankruptcy. It is available to businesses as well as individuals. For individuals, in order for a person to qualify for a Chapter 7 bankruptcy, a means test must be performed. If a person makes too much money for number of persons in the immediate family, then the presumption is raised that the person would be abusing the bankruptcy system if they filed a Chapter 7 bankruptcy. The Chapter 13 bankruptcy option would still be available to the person seeking bankruptcy protection.
If a Chapter 7 bankruptcy is available, the debtor must create a list of all of their assets, debts, monthly income and monthly expense. It is crucial that the debtor disclose everything about their financial status to the bankruptcy court. A failure to provide all information could result in a denial of a discharge of the debts or possibly federal prosecution.
After the debtor provides all necessary information, they will review and sign their bankruptcy petition and schedules. Within 20 to 45 days, they will attend a creditors meeting. At the creditors meeting, creditors have the right to question the debtor regarding the discharge of their debt. Creditors will usually have 60 days after the creditors meeting to either file an objection to the discharge or have the debtor agree to a reaffirmation agreement. In the event that neither is accomplished, most of the debts will be discharged.
For specific information regarding whether your specific debts would be discharged, it is import to contact an attorney for specific legal advice. The contents of this page are not to be used as a substitute for advice of an attorney.