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. It is converted in to cash by the trustee in order to allocate amongst 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. A sole individual though cannot file under chapter 7 bankruptcy information. 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 .
Ah honest individual should be given a new beginning is the concept behind bankruptcy. Therefore the debtor is not legally responsible for discharged debts. In the case of discharging under chapter 7 bankruptcy, it should be known that it is only an option for individual debtors as opposed to the previously mentioned scenario. Since some categories of debts are not discharged , an individual’s right of discharge is not to be taken fro granted.
It is a smart option to figure the best choice for you regarding the chapter 7 bankruptcy, with the help of a qualified attorney. First though you need to figure out for yourself if you actually need to file for bankruptcy. Many such evaluation forms are available online for those interested. Always make sure that you provide your attorneys with complete and correct information to gain a better evaluation on your case. The recept of all the debts for the debtor should also be made 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.
