Chapter 7 Bankruptcy Lawyers Serving Indianapolis and Central Indiana
A Chapter 7 Personal Bankruptcy May:
- Provide Automatic Court Protection From Creditors
- Stop Harassing Calls and Letters
- Stop Lawsuits and Garnishments
- Give You a Permanent Discharge of Most Debts in a Few Months
- Let You Keep Your Car and House
Consider a Chapter 7 Personal Bankruptcy if:
- You Have Minimal Assets or Equity in Assets
- You Have Trouble Making Monthly Payments on Necessities and Basic Expenses
- You are Current on House and Car Payments (When Applicable)
What is a Chapter 7 Bankruptcy?
A Chapter 7 Bankruptcy is the straight or liquidation chapter of personal bankruptcy. A single person or married couple files papers with the Bankruptcy Court asking for immediate protection from their creditors and ultimately for an elimination (discharge) of most debts.
What Can I Keep in a Chapter 7 Bankruptcy?
You may have heard chapter 7 bankruptcy referred to as a “liquidation”. The term is a little misleading. In the vast majority of cases people keep everything they have.
Can I Keep Our Home or Car?
In a chapter 7 bankruptcy you will have the option of “reaffirming” secured debts like houses or cars. Reaffirming a debt makes you responsible on the debt again. House/Car creditors are generally happy to allow reaffirmations on their debts as long as you are current on payments.
What About Credit Cards?
Credit cards are dischargeable in chapter 7 bankruptcy.
Can I file a Chapter 7 Bankruptcy?
If you have not filed a chapter 7 in at least eight (8) years or a chapter 13 in the last six (6) years you may qualify for a chapter 7 bankruptcy. Since the change in the bankruptcy law in 2005 a person or married couple must also qualify for a chapter 7 bankruptcy under an income based test called the Means Test. Estimates indicate that approximately 96% of people that qualified for a chapter 7 prior to the law change are still eligible to file a chapter 7. In the unlikely event that you are not qualified for a chapter 7 it is possible to significantly reduce your debt obligations with a chapter 13.
Bankruptcy and Cosigners
When you file for Chapter 7 Bankruptcy and you have debt that has a cosigner, the court grants a discharge that legally protects you from creditors pursuing collection. However, the amnesty a debtor may receive from the court will not be given in the same way to a cosigner.
There are options with Chapter 7 to protect a cosigner, such as keeping and continuing to pay on the co-signed debt (as long as it is a secured debt, such as a mortgage or a car loan). Agreements can be made for informal repayment plans to a cosigner, or a cosigner may also choose to eliminate the debt through Chapter 7 Bankruptcy.
How Long Does Chapter 7 Bankruptcy Take?
From filing to discharge, a chapter 7 bankruptcy usually takes between three and four months. Much of this time is the result of mandatory waiting periods the law requires.
What Happens After Bankruptcy Discharge?
Once your foreclosures have been stopped, your debts have been discharged, and your finances seem to be straightening out, it’s tempting to jump on every “credit repair” bandwagon you find. The problem is that most credit repair offers come with consequences: high interest rates, and huge fees.
There are a few surefire ways to rebuild your credit after you complete the bankruptcy process, but there are also plenty of credit traps to avoid. Don’t get stuck believing all the “quick fix” tips. Learn how to make smart credit decisions post-bankruptcy.
Is a Chapter 7 Bankruptcy Right for Me?
We offer a free, no obligation consultation with an attorney. Your creditors have attorneys, collection agents, and money. Allow us to explain your rights. Together we can level the playing field against them and find a solution to your debt problems.
How to Choose a Bankruptcy Attorney?
If you are feeling overwhelmed by student loans, credit card debts, and are being victimized by creditors and wage garnishment, you can put a quick stop to all of it by filing Chapter 7 Bankruptcy. But where do you start?
Selecting a Bankruptcy Attorney is key in your journey to financial rehabilitation, and can make or break your experience. Choose an attorney to assist you based on their experience and compassion.
FILING FOR BANKRUPTCY? FIND OUT YOUR NEXT STEPS
There is a very specific process that has to be followed when filing for bankruptcy. Before you can file, you must take a means test to determine if you actually qualify for bankruptcy protection, and which form, Chapter 7 or Chapter 13 bankruptcy. You will then file your bankruptcy petition and other required documents with the U.S. Bankruptcy Court.
Once your petition is filed, an automatic stay is issued by the court that instantly halts all creditor activity against you, including any collection actions. Your creditors will be legally stopped from contacting you in any way while the bankruptcy process unfolds.
Once your paperwork is filed, a bankruptcy trustee will arrange a creditor meeting or 341 hearing. The hearing is not in front of a judge and it is not in a courtroom. The hearing is with another attorney called a Trustee. I will attend the hearing with you.
Creditors in reality rarely attend the meeting and that part of the process is out of the way quickly. You are required to attend this meeting, and I will be at the meeting with you and help you with all aspects of the meeting. Before your bankruptcy case is complete, you will be required to attend a financial management course.
Under Chapter 7, your debts will be discharged after about 4 months. Under Chapter 13, your debts will be discharged after you complete your Chapter 13 debt repayment plan. Your plan will usually run 3-5 years.
Once you receive your discharge, you will be free from most of your debts. Remember that certain debts may be non-dischargeable and will not go away if you file Chapter 13 or 7.