Do You Need Chapter Seven Bankruptcy?

Referred to as 'straight bankruptcy' is a situation where the debtor hands over all their surviving property to a bankruptcy trustee is the chapter 7 bankruptcy. The trustee then converts it in to cash in order to allocate it among the creditors. The debtor in the case of a chapter 7 bankruptcy receives a release of all dischargeable debts within approximately four months. Since they have lost it all, many people who claim Chapter 7 bankruptcy will not receicne a large sum of money . This will mean a new beginning for the bankruptcy party is required.

In order to be eligible to file for chapter 7 bankruptcy, the debtor must be an individual, partnership or corporation or other business unit. Under Chapter 7 bankruptcy, a sole individual cannot claim. If the debtor receives credit counselling within 180 days from an approved agency, some exceptions are made. A chapter 7 bankruptcy is only issued after the debtor fills out a petition with the bankruptcy court regarding their assets. In addition to this the debtor must also file a schedule of assets and liabilities, a schedule of current income and expenditures and a statement of financial affairs with the court .

The main reason for bankruptcy is to give an honest individual a new beginning. Therefore the debtor is not legally responsible for discharged debts. As opposed to the previous mentioned case under the chapter 7 bankruptcy it is only an option for individual debtors. Though this is the general procedure, an individual's right of discharge is not to be taken for granted as some categories of debts are not discharged.

It is a smart option to figure the best choice for you regarding the chapter 7 bankruptcy, with the help of a qualified attorney. The need of filing a bankruptcy should be finalized before anything. Online evaluation forms are also available. Always make sure that you provide your attorneys with complete and correct information to gain a better evaluation on your case. It is also essential to remember that the debtor receives a discharge on all dischargeable debts in chapter 7 bankruptcy. Therefore though in some cases this would mean losing all ones assets, in the majority of cases, this isn't so. Therefore it is essential that you have a bankruptcy attorney before making any rash decisions.

Article Source: http://freelegalinformation.info

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