When an individual is filing for chapter 7 bankruptcy, it’s usually because their income is lower than the amount of monthly expenses that must be paid. There are several requirements that must be met in order for any person to qualify for chapter 7 bankruptcy relief. It’s not simply a matter of filing the paperwork and turning in a list of debts and assets.
A bankruptcy schedule must be established, creditors must be notified, and a Meeting of Creditors must be scheduled in a timely manner. Often, nonexempt assets will be seized, and not all debts can be discharged through filing for chapter 7 bankruptcy. Filing for bankruptcy is a fairly complex affair, which is why it’s a good idea to hire a chapter 7 bankruptcy attorney in Bowie, MD prior to beginning the process.
Nondischargeable Debts
Most debts, such as credit card debt, medical bills, and collections, can be discharged through filing for bankruptcy. However, not all debts can. Debts like student loans, child support, alimony, and most taxes are nondischargeable.
Property Exemptions
There are protections under both state and federal law to help those filing for bankruptcy avoid losing certain types of property. The assets that cannot be sold to the benefit of a debtor’s creditors are known as exempt assets. A chapter 7 bankruptcy attorney in Bowie, MD can help their clients determine whether they will lose property when filing for personal bankruptcy.
Effect on Credit Report
Most of the time, a chapter 7 bankruptcy will show up on personal credit reports for ten years. It will also have an impact on the individual’s credit score. However, most effects of filing for bankruptcy are short-term, allowing individuals to begin improving their credit scores in as little as 12 to 18 months after receiving a discharge of debts.
Hire an Attorney
If all of this sounds a bit complicated, it’s because, generally speaking, it is. A chapter 7 bankruptcy attorney in Bowie, MD can help their clients understand both the positive and negative consequences of filing for bankruptcy, and to determine whether or not it is the most appropriate solution.
