If debts are bugging you and you can't seem to find a way to get out of them, you may want to consider Chapter 7 bankruptcy. It's a great way to write off your debts and rebuild yourself financially.
While many people file for bankruptcy, very few understand the Chapter 7 bankruptcy law. As such, people always have a load of questions that they need to be answered. Here are the most common questions.
Do You Require a Lawyer to File for Bankruptcy?
Filing for bankruptcy has become easier as you can do it on your own. So if you feel you're comfortable initiating the process, you can proceed. On the other hand, hiring a chapter 7 bankruptcy attorney might come in handy if you don't know how to go about the process.
Besides, a lawyer will ensure that no mistakes are made when completing the required paperwork. Apart from helping you complete the paperwork, your lawyer will protect you and your assets and represent you in bankruptcy court if the need arises.
What Types of Debts Does Chapter 7 Bankruptcy Discharge?
If your Chapter 7 bankruptcy application goes through, the court will discharge your unsecured debts as long as the creditors won't dispute it. So you can expect to get cleared of medical bills, credit card debts, unsecured personal loans, phone bills, and unpaid utilities.
While these debts can be forgiven, don't expect the court to discharge the following types of debts:
- Child support or alimony
- Student loans
- Any debts that you didn't include on your bankruptcy petition
- Fines owed to government agencies
- Personal injury debts
Will Creditors Continue To Harass You After Filing for Bankruptcy?
If you hire a lawyer to file a Chapter 7 bankruptcy, you should inform your creditors to contact your lawyer if they need to communicate with you. The creditors will no longer have permission to harass you unless they're allowed by the bankruptcy court.
Once your attorney files for bankruptcy, the automatic stay goes into effect. As such, the creditors must cease any communication and collection efforts.
Is Everyone Eligible for a Chapter 7 Discharge?
Not all debtors qualify for a discharge under Chapter 7 bankruptcy. For instance, debtors who try to defraud creditors by filing for bankruptcy may not be eligible for discharge. Besides, you may not qualify for discharge if you had been granted another discharge within the past eight years. You'll also be required to take a means test to determine whether you're eligible for Chapter 7 bankruptcy.