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Personal Bankruptcy Chapter 7

Notice To The Commission And Right To Be Heard

Personal bankruptcy – Chapters 7 and 13 | Finance & Capital Markets | Khan Academy

The clerk shall give the notice required by section 342 of this title to the Commission.

The Commission may raise and may appear and be heard on any issue in a case under this chapter.

Historical and Revision Notes

senate report no. 95989

Section 762 provides that the Commission shall be given such notice as is appropriate of an order for relief in a bankruptcy case and that the Commission may raise and may appear and may be heard on any issue in case involving a commodity broker liquidation.

What Does It Cost To File For Bankruptcy

Court costs are now $338 to file for bankruptcy under chapter 7 and $314 to file for bankruptcy under chapter 13, whether for one person or a married couple. In addition to this government filing fee, you will have to pay for the firm to obtain the three credit bureau reports so we can ensure including all your debts.

Since I filed personally filed bankruptcy, I make certain my fees are lower than most of my competitors. The systems and process we have developed over the years allows our law firm to charge less while providing the highest level of personal attention possible.

What To Do Post

  • Establish a budget you can stick to.
  • Open a savings account and save a month’s worth of income to provide a financial cushion for unexpected expenses.
  • Get a secured credit card and use it only for expenses you can pay off at the end of the month.
  • Pay your rent and bills on time.
  • Check your credit report regularly to make sure no debts discharged in bankruptcy remain outstanding on your profile.
  • If you follow a disciplined plan, you can quickly improve your credit profile and even be eligible for a Federal Housing Administration mortgage in as little as three years.

    “There is such a stigma associated with bankruptcy,” Leibowitz said. “But the idea of rehabilitation and forgiveness is baked into our constitution.

    “Bankruptcy can give people a second chance.”

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    Filing A Chapter 7 Petition

    The Chapter 7 bankruptcy process truly begins when you file your documents and a petition with the bankruptcy court. This court serves the area where you live or where your business is organized .

    A married couple can choose to file a joint petition together or to file as individuals.

    In an emergency , you can file for bankruptcy without filing all of the necessary forms. However, you must file the remaining paperwork within 15 days.

    You must attend before you file. It is required to be:

    • With a credit counseling agency approved by the state
    • At least 180 days before filing for bankruptcy

    This counseling agency will help you determine whether Chapter 7 is the best option for you.

    Sometimes other alternatives, such as entering into a repayment plan with the creditor, will resolve financial problems. It’s important to work with a local bankruptcy lawyer who can help you figure out of Chapter 7 is the best option for your situation.

    How Does Bankruptcy Affect Assets And Liabilities

    Arizona Chapter 7 Bankruptcy

    Depending on how you choose to declare bankruptcy, your assets and liabilities will be affected in different ways. In a Chapter 7 bankruptcy, many of your assets are up for liquidation to pay your creditors with the proceeds. In Chapter 13, you retain assets while working on a repayment plan for your outstanding debts.

    See how bankruptcy affects assets and debts in the following debtee categories.

    Small Business Owners

    For small business owners with lots of personal debt, bankruptcy may help them continue to stay in business. It’s important to note that business debts aren’t alleviated with Chapter 7 or Chapter 13 unless you’re a sole proprietor and are personally responsible for them.

    • Chapter 7: For sole proprietors, business and personal debts can be wiped out in a single bankruptcy case. You’re not obligated to meet income requirements if your business debt exceeds your personal debt.
    • Chapter 13: Your business assets aren’t liquidated, but only your personal liability for business debts can be wiped out. The business remains responsible for its debts.

    Some business assets can be exempt from Chapter 7 bankruptcy filings. For instance, if your business is service-based and doesn’t maintain equipment or significant inventory, you can likely continue to run your business after discharging business debts through bankruptcy.

    Student Loan Holders

    Mortgage Holders

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    What Debts Are Discharged In Chapter 7 Bankruptcy

    A Chapter 7 bankruptcy will generally discharge your unsecured debts, such as credit card debt, medical bills and unsecured personal loans. The court will discharge these debts at the end of the process, generally about four to six months after you start.

    Some types of unsecured debts usually aren’t discharged through a Chapter 7 bankruptcy, including:

    • Personal injury debts you owe due to an accident while you were intoxicated
    • Unsecured debts that you intentionally left off your filing

    Your creditor could also object and keep certain debts from getting discharged. For example, a credit card company could object to the debt from recent luxury goods purchases or cash advances, and the court may decide you still need to repay this portion of the credit card’s balance.

    Additionally, a Chapter 7 bankruptcy may discharge the debt you owe on secured loans. Secured loans are those backed by collateral, such as your home for a mortgage, or when a creditor has a lien on your property. However, even if the debt is discharged, the creditor may still have the right to foreclose on or repossess your property.

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    What Happens When You File Chapter 7

    Chapter 7 is one of the most common types of bankruptcy. In a Chapter 7 bankruptcy, you will:

    • Forfeit many of your assets to be sold for cash
    • Pay your creditors with the money from your asset liquidation

    There are certain assetssuch as a limited amount of cash, clothing, household items, and a carthat you are allowed to keep, but these exemptions vary depending on the state you live in.

    Once your assets are liquidated and creditors are paid, any remaining debts you owe are forgiven unless you’ve reaffirmed the debt. Debt reaffirmation is when you voluntarily waive protection through the bankruptcy discharge and agree to remain responsible for the debt. Reaffirmation is chosen to retain certain assets and avoid liquidation.

    Not everyone can file a Chapter 7 bankruptcy. If your income is too high, you may be required to file a Chapter 13 bankruptcy instead.

    How Long Does Chapter 7 Bankruptcy Take

    What Does Your Chapter 7 Trustee Really Think About Your Case

    Most people can file their bankruptcy forms within one week if theyâre organized. The 341 meeting with the trustee who oversees your case takes place about one to two months after you file.

    If all goes well, two to three months after your meeting with your trustee, youâll get a letter in the mail that your debt is officially discharged. This means that that Chapter 7 bankruptcy from beginning to the discharge of your debts takes about 3-5 months.

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    Chapter 7 Compared To Chapter 13

    People who do not pass the Chapter 7 means test have the option to file for Chapter 13 bankruptcy instead. Chapter 13 requires you to pay back debt over time using a repayment plan under which installment payments are made to creditors over three to five years.

    You can decide that Chapter 7 is not right for you at any time. Changing to Chapter 11, 12, or 13 filing is allowed as long as:

    • You are eligible under the rules for those chapters
    • Your case was not already converted to Chapter 7 bankruptcy from one of the other chapters
    • You do not try to change the case repeatedly

    How Does Bankruptcy Work In Ontario When Living With Your Parents

    No co-signors and no itemized list of things of things you own.

    You will be counted as a family of one person, basically like you had roommates. Your income/debts is yours, theirs is theirs.

    But what would I declare under assets? I don’t own anything and whatever is in the house are not my items.

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    Alternatives To Chapter 7

    Debtors should be aware that there are several alternatives to chapter 7 relief. For example, debtors who are engaged in business, including corporations, partnerships, and sole proprietorships, may prefer to remain in business and avoid liquidation. Such debtors should consider filing a petition under chapter 11 of the Bankruptcy Code. Under chapter 11, the debtor may seek an adjustment of debts, either by reducing the debt or by extending the time for repayment, or may seek a more comprehensive reorganization. Sole proprietorships may also be eligible for relief under chapter 13 of the Bankruptcy Code.

    In addition, individual debtors who have regular income may seek an adjustment of debts under chapter 13 of the Bankruptcy Code. A particular advantage of chapter 13 is that it provides individual debtors with an opportunity to save their homes from foreclosure by allowing them to “catch up” past due payments through a payment plan. Moreover, the court may dismiss a chapter 7 case filed by an individual whose debts are primarily consumer rather than business debts if the court finds that the granting of relief would be an abuse of chapter 7. 11 U.S.C. § 707.

    Debtors should also be aware that out-of-court agreements with creditors or debt counseling services may provide an alternative to a bankruptcy filing.

    Consider Hiring A Real Estate Agent Who Specializes In Foreclosures

    Chapter 7 Bankruptcy: What it Is and How to File

    You dont necessarily need a real estate agent in order to buy a foreclosure, but they can provide expert advice on foreclosures in your search area. They can also help you assess whether a foreclosed homes asking price is worth the potential risks involved, such as budget issues or repairs.

    If you know you dont want to hire a real estate agent, start by searching for foreclosed homes online. You can also drive through neighborhoods to see if there are any homes for sale labeled Foreclosure Property. Make sure you research what other homes, both foreclosed and non-foreclosed, in the area sell for so you can see whether the property youre interested in falls above or below that level.

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    Who Qualifies For Chapter 7 Bankruptcy

    There are a few requirements you’ll need to meet to file for a Chapter 7 bankruptcy:

    • You generally must complete an individual or group credit counseling course from an approved credit counseling agency within 180 days before filing.
    • Either the average of your monthly income during the previous six months must be less than the median income for the same-sized household in your state or you must pass a means test, which determines if your disposable income is high enough to make partial payments to unsecured creditors. If you don’t pass the means test, you may still be able to file a Chapter 13 bankruptcy.
    • You can’t have filed a Chapter 7 bankruptcy during the past eight years.
    • You can’t have filed a Chapter 13 bankruptcy during the past six years.
    • If you tried to file a Chapter 7 or 13 bankruptcy and your case was dismissed, you have to wait at least 181 days before trying again.
    • You may be eligible to file, but a court could dismiss your case if it determines you’re trying to defraud your creditors. For example, if you take out a loan or use credit cards with the intent of then declaring bankruptcy to avoid repaying the debt.

    Basics And Eligibility For Chapter 7

    Chapter 7 bankruptcy focuses on liquidating your nonexempt assets, if you have any, to repay creditors before your remaining debt is discharged. The process can get rid of many types of unsecured debt such as credit card debt, medical bills, and utility bills.

    Chapter 7 is the most common of the bankruptcy options available to individuals. Another bankruptcy option available to individuals is Chapter 13, which focuses on debt repayment. Chapter 12 bankruptcy is a relatively new option available to âfamily farmers” and âfamily fisherman.”

    To qualify for Chapter 7 bankruptcy you must meet specific eligibility requirements, including a “means test.” The purpose of the test is to prevent high-income earners from qualifying for Chapter 7.

    You pass the means test automatically if your average monthly income for the six months before filing for bankruptcy is less than or equal to your state’s median income.

    If your income is higher than your state’s median income, you may still pass the means test if it’s determined that you don’t have enough disposable income to pay your creditors after taking into account your income, expenses, and family size.

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    To Find Out What Is Best For You Think About Your Current Financial Situation

    • Spending more than you earn?
    • Facing legal action, such as garnishment?
    • Using credit cards for necessities?
    • At risk of losing credit card privileges?
    • Receiving harassing collection letters or phone calls?
    • Stressed out due to financial problems?

    If this sounds like you and you are experiencing some or all of the above, contact us today.

    Personal Insolvency Counselling

    MNP offers permanent life-changing debt solutions to individuals struggling with an overwhelming amount of debt. Our trustees are here to help.

    Get Started Now!

    What Is A Foreclosed Home

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    A foreclosed home is one that a homeowner has to give back to their lender because they can no longer afford to make their mortgage payments. The house may then be put on the market by the bank or loan company at a significantly lower asking price. This is usually because banks and loan companies are looking to recover their loan, so they want to sell the home as quickly as possible.

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    When To Declare Bankruptcy: 8 Questions To Ask Yourself

    Most people take their financial obligations seriously and want to pay their debts in full, but knowing when to file bankruptcy and when to negotiate or use another strategy can help put you on the road to financial health.

    Here are a list of questions that can help you assess your financial health and give you insight into whether bankruptcy may be right for you. You should also discuss these questions with an attorney.

    Role Of The Case Trustee

    When a chapter 7 petition is filed, the U.S. trustee appoints an impartial case trustee to administer the case and liquidate the debtor’s nonexempt assets. 11 U.S.C. §§ 701, 704. If all the debtor’s assets are exempt or subject to valid liens, the trustee will normally file a “no asset” report with the court, and there will be no distribution to unsecured creditors. Most chapter 7 cases involving individual debtors are no asset cases. But if the case appears to be an “asset” case at the outset, unsecured creditors must file their claims with the court within 90 days after the first date set for the meeting of creditors. Fed. R. Bankr. P. 3002. A governmental unit, however, has 180 days from the date the case is filed to file a claim. 11 U.S.C. § 502. In the typical no asset chapter 7 case, there is no need for creditors to file proofs of claim because there will be no distribution. If the trustee later recovers assets for distribution to unsecured creditors, the Bankruptcy Court will provide notice to creditors and will allow additional time to file proofs of claim. Although a secured creditor does not need to file a proof of claim in a chapter 7 case to preserve its security interest or lien, there may be other reasons to file a claim. A creditor in a chapter 7 case who has a lien on the debtor’s property should consult an attorney for advice.

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    Foreclosure Listings Government Sites

    HUD.gov. Potential investors and other home buyers can find one- to four-unit residential properties that the Department of Housing and Urban Development acquired from foreclosure actions on FHA-insured mortgages.

    USDA-RD/FSA Properties. The United State Department of Agriculture-Rural Development and the USDA-Farm Service Agency list properties on this website. Here, youll find a small number of single- and multi-family homes, farms, and ranches.Buyers should contact the local USDA-RD office for more information on the property and how to buy it.

    IRS Seizures. This Internal Revenue Service website is a portal to finding homes and other property seized by the tax agency for nonpayment of federal taxes.

    What About The Credit Counseling Classes For Bankruptcy

    Chapter 7 bankruptcy is a liquidation proceeding in which the debtorâs ...

    After your case is filed, you must complete an approved course in personal finances. This course will take approximately two hours to complete. Many of the course providers give you a choice to take the course in-person at a designated location, over the Internet , or over the telephone.

    Many clients hear they must take a class, they start thinking back to school and having to take a test and possibly failing. Dont worry. This class is an online course that does not have a pass or fail component. There are no right and wrong answers. It is more informative and used to help you understand your finances. We will coordinate it for you.

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