How Does CHAPTER 7 BANKRUPTCY Work?

Chapter 7 provides a fresh start for individuals who need to eliminate their debt and start over with a clean slate. This fresh start allows individuals to eliminate all or most of their debt in exchange for surrendering their non-exempt assets to a bankruptcy trustee for liquidation and distribution to their creditors. There are an array of exemptions that allow individuals to protect assets like their home, car, and household goods from liquidation.  In addition, assets without equity are generally not liquidated by the bankruptcy trustee. As soon as you file Chapter 7, you are protected from collection calls, wage garnishments that are not for child support, foreclosures and repossessions. In addition, any wages you earn after filing are generally yours to keep, free from the demands of your creditors. With limited exceptions, debts that you do not elect to reaffirm are discharged and you are no longer responsible for them, even if the bankruptcy trustee is not able to pay them from the liquidation of your assets.

Because chapter 7 eliminates debt you cannot afford to repay, obtaining a discharge will be a step towards rebuilding your credit, as the negative information associated with all of the discharged debt will gradually disappear from your credit report. Stubbs & Perdue can also enroll you in the a program after you file which can help you rebuild your credit.  Following the filing of your case, creditors are prohibited from ever attempting to collect that debt from you again and can no longer call you, send you letters demanding payment, or harass you in any other way.

A Chapter 7 case is the quickest way for most individuals to discharge debts.   However, before we recommend that you file Chapter 7, we meet with you to review of your assets, liabilities, and income to make sure that filing Chapter 7 is the best option for you.

Chapter 7 also provides a way for businesses which have no hope of rehabilitating their operations to liquidate their assets and close down their operations in an organized and centralized process.

Contact our board certified bankruptcy attorneys in North Carolina

Don’t continue to live under a cloud of unmanageable debt. Chapter 7 bankruptcy can quickly discharge your debt and give you a fresh start. Call Stubbs & Perdue at 1-800-348-9404 or contact us online to schedule your bankruptcy consultation at our New Bern or Raleigh offices.