Dealing with debt and financial problems is extremely stressful. It is, however, not impossible. Seeking legal help from an experienced Wheeling bankruptcy attorney will help you have a successful bankruptcy filing.

Filing for Bankruptcy Chapter 7, which is also referred to as liquidation bankruptcy, can eliminate several types of debt. In certain cases, some properties, such as your vehicle and jewelry, may be surrendered. However, most debtors do not have to give up these assets.

Chapter 7 bankruptcy is often referred to as the simplest bankruptcy chapter. Unsecured debts such as credit card bills, medical bills, and personal loans are discharged when you file Bankruptcy Chapter 7. These are in contrast to non-dischargeable debts, which include common secured debt, child support, alimony, and student loan debt.

This article will focus on:

– Qualifications for filing bankruptcy under Chapter 7

– How to file bankruptcy under Chapter 7

– Is bankruptcy Chapter 7 the best option for you

– Rebuilding credit

– Importance of seeking legal advice from experienced bankruptcy attorneys

Qualifications for filing Chapter 7 bankruptcy

To be eligible for bankruptcy, you must first meet several requirements. For you to be qualified for filing a bankruptcy petition under Chapter 7, you should pass the bankruptcy means test. This test examines your monthly income, assets, and living expenses. 

When you file bankruptcy, you should not have previously filed bankruptcy under Chapter 7 in the last 8 years (or filed under Chapter 13 in the last 6 years). Additionally, you must not have filed a petition in bankruptcy within the last 180 days that was dismissed due to failure to appear in court or comply with court orders.

How to file bankruptcy under Chapter 7

Filing Bankruptcy Chapter 7You may be able to finish the bankruptcy process in about six months. You will have to go through a few steps, including the following:

  1. Undergo credit counseling. You must complete bankruptcy counseling with a certified nonprofit credit counseling provider.
  2. Consult with a bankruptcy lawyer. Hiring the best lawyers is important if you are considering bankruptcy. Bankruptcy lawyers will help you understand bankruptcy law and assist you throughout the bankruptcy proceeding.
  3. Gather all paperwork. A trusted Wheeling bankruptcy attorney will help you with the filing of your petition for bankruptcy as well as other supporting documents. However, it is your responsibility to collect and actually file all relevant documents about your properties, taxes, and debts. At this stage, an automatic stay takes effect. An automatic stay prohibits any collection activity from debt collectors and stops wage garnishment and foreclosure.
  4. Let the bankruptcy trustee take over. The court will assign a trustee that will take over the management of your case. 
  5. Attend the creditors’ meeting. The trustee in bankruptcy will call a meeting that includes you, your bankruptcy attorney, and the creditors. You will be asked questions related to your bankruptcy forms and finances.
  6. Deal with nonexempt properties. Assets that are not exempt are managed by the bankruptcy trustee. Trustees are the ones who decide whether the nonexempt properties are worth selling to pay back debts.
  7. Deal with secured debts. You may be able to reaffirm the debt (arrange to exclude the debt and continue making payments) or redeem the collateral (paying the creditor with the current value of the property).
  8. Finish a financial education course. Before the dismissal of your bankruptcy case, you must complete an education course that is offered by a nonprofit credit counseling organization.
  9. Wait for bankruptcy discharge. Bankruptcy filings will be discharged in about three to six months after you file a bankruptcy petition, which means all qualifying debts will be forgiven.

Is bankruptcy Chapter 7 the best option for you?

Keep in mind that other types of debt such as child support, student loan debt, and tax debt are not dischargeable when you file bankruptcy. If eliminating other types of debt will free up a sufficient amount of money to cover non-dischargeable debts, filing bankruptcy could still be a very good option for you.

Before you decide on which path you will take, seek legal advice from Wheeling bankruptcy attorneys to help you on which debt relief option is best given your circumstance.

Rebuilding credit

After filing bankruptcy, you will have the opportunity to have a fresh start with your finances and restore your credit. You should develop a financial management plan. Create a budget and set financial goals. You can also rebuild your credit by making on-time payments, keeping your credit balances low, and disputing errors on your credit reports.

Seek legal advice from experienced bankruptcy attorneys

The bankruptcy procedure may be complicated for you to handle on your own. Consulting an expert is important for you to have the best outcome with your bankruptcy case. Contact our Wheeling bankruptcy attorney at Thomas E. McIntire & Associates, LC for a free consultation.