Six Questions You must Ask When Filing for Chapter 7 Bankruptcy in 2021
This COVID-19 pandemic has made many people’s lives difficult. People have lost their earning source, but the expenses are still the same or high. In a time when everyone is struggling with financial situation the Bankruptcy law can help you to get freedom from your debts.
If you are struggling with a financial crisis and wondering how to get rid of it, this article may help you!
Paying your bills and getting rid of unsecured debts are not hectic now. You can utilise bankruptcy law to restart a fresh lifestyle by wiping out your unsecured debt burdens.
Are you thinking of filing Chapter 7 Bankruptcy?
There are a few things you should know before proceeding for it.
To know more in detail about Chapter 7 Bankruptcy, please click here.
To sum up, in brief, Chapter 7 Bankruptcy is a legitimate process to get free from your unsecured debts with the help of the court. Otherwise known as “Liquidation or Straight Bankruptcy” Chapter 7 helps eliminate debts and is a common type of bankruptcy most people opt for in the USA.
But certain questions may arise in your mind related to Chapter 7 Bankruptcy. In this article, we will let you know what questions you should ask when filing for Chapter 7 Bankruptcy in 2021.
#1 What debts can and can’t be covered under Chapter 7?
This is the first and foremost question one should ask prior filing Chapter 7. As there are various types of bankruptcy chapters, you have to understand the nature of Chapter 7 Bankruptcy and the debts covered under it.
Chapter 7 Bankruptcy can help you erase below type of debts:
- Credit card bills
- Vehicle loans
- Medical bills
- Personal loans
- Utility bills
Chapter 7 Bankruptcy can’t obliterate below type of debts:
- Student loans
- Tax debts or other debts you have to pay to the government
- Alimony or child support
The debts that can be erased by Chapter 7 bankruptcy are known as “dischargeable debts”, and the other obligations that can’t be covered are called “non-dischargeable debts”.
#2 Whether am I eligible for Chapter 7 Bankruptcy?
There are certain qualification criteria set for filing Chapter 7 Bankruptcy. These criteria are imposed to decide who can file for it and who can’t. You have to pass the “means test” in order to go further with the process of filing chapter 7.
Apart from passing the “means test” below are the other qualification criteria to file for Chapter 7 Bankruptcy:
- You should not be a part of LLC, corporation or partnership firm
- You have to complete a pre-bankruptcy credit counselling course
- You have not had any previous bankruptcy discharge
- It would be best if you didn’t have Bankruptcy dismissal in a period of the last six months
To know whether you qualify for Chapter 7 Bankruptcy read our specific article on it.
#3 What fees do I have to pay?
The court charges filing fees of $338 for the Chapter 7 case. Till 1st December 2020, the costs were $335. You also have to pay the charges of the attorney as they will guide you throughout the entire process to get the discharge of the case.
To know how much Tucson Chapter 7 Attorneys charge click here.
#4 When the case will be filed and when it will get discharged?
After you pay the retainer amount, you can file Chapter 7 immediately. The attorney may ask you for full payment. Once you submit all your financial details, the attorney starts the paperwork and will explain the entire process to you. Your co-operation and availability decide how long the discharge process will take.
#5 Can I keep my property if I file Chapter 7 bankruptcy?
In most of the cases, you can keep your property when you file Chapter 7 Bankruptcy. There is an exemption rule set by the law that lets you keep different property types like furniture, clothes, cars etc. The exemptions depend on the state you live, and when your property value exceeds the limit of exemption, the trustee may seize your property to sell them in order to pay your debts.
#6 Can businesses get rid of their debts with Chapter 7 Bankruptcy?
No, Chapter 7 Bankruptcy is especially for individuals who are facing financial problems and unable to pay off their debts.
Your financial condition and eligibility are two main factors in filing Chapter 7 Bankruptcy. But if you think whether you need a Lawyer to file for Chapter 7 Bankruptcy in Tucson? Then the straightforward answer is Yes. As the process needs professional attention to get the most out of the law, you need a legal professional’s guidance.