“Speak to Our Attorneys to See if Filing Chapter 7 Bankruptcy is Right for Your Situation”
Memphis Chapter 7 Lawyer
A debtor who is unable to pay the debts he or she owes can seek a discharge of these debts through a “Chapter 7” bankruptcy. Chapter 7 bankruptcy is also sometimes referred to as a “straight” or “liquidation” bankruptcy because while the court eventually discharges the eligible debts and liabilities of the debtor, it also liquidates or sells certain assets of the debtor and distributes the proceeds of the sale or sales to the debtor’s creditors. The entire process typically takes about six months. Once the court enters a discharge order, the debtor has no further legal obligation as to the debts and liabilities included in the discharge order.
Thinking of filing for Chapter 7 bankruptcy? Self-help books and do-it-yourself kits are a poor substitute for the advice and assistance of an experienced Memphis bankruptcy attorney. You could lose important assets and fail to discharge debts you could have otherwise included if you are unfamiliar with the complex federal and state bankruptcy laws. Contact Douglass & Runger, Attorneys at Law, for help.
Who Can File for Chapter 7 Bankruptcy?
Not everyone is eligible to file for a Chapter 7 bankruptcy. If an ineligible person attempts to file for Chapter 7, his or her petition will be dismissed and any protections he or she was afforded at the time he or she filed the petition will be lost (for example, the automatic stay that is put in place once a bankruptcy petition is filed and that prevents creditors from taking any further collection actions against the debtor will be lifted and collection activities will resume). In general, the following individuals are ineligible to file for Chapter 7 bankruptcy:
- Those who filed for bankruptcy in the previous six to eight years and received a discharge of that bankruptcy; and
- Those whose income, assets, and debts make it appear that, under a means test, the debtor could successfully complete a repayment plan as part of a Chapter 13 bankruptcy (in other words, if a person makes too much money, he or she cannot file for Chapter 7)
A person who is ineligible to file for Chapter 7 bankruptcy may be able to still file for bankruptcy under another chapter of the bankruptcy code. For example, a debtor with too many assets may be able to file for Chapter 13 bankruptcy if he or she cannot file for Chapter 7.
Will I Lose All My Property in a Chapter 7 Bankruptcy?
The court trustee – the individual designated by the court to oversee your bankruptcy – will be given authority to take possession of and liquidate any “nonexempt” assets you have. “Nonexempt” assets are those assets that debtors are not permitted to keep under state and/or federal laws. For example, Tennessee debtors who file for Chapter 7 bankruptcy are permitted to keep up to $5,000 of equity in their homes (up to $25,000 in equity if you have at least one minor child). You may also be able to keep certain books, tools, and retirement accounts.
Even if property is nonexempt, the trustee may determine that it has little value or would be too difficult to sell to warrant liquidation. In this case, the trustee may permit you to keep the property even though it is nonexempt.
Contact a Skilled Memphis Chapter 7 Bankruptcy Attorney Today
Douglass & Runger, Attorneys at Law, is a Tennessee bankruptcy law firm dedicated to helping individuals obtain debt relief through the bankruptcy process. Learn if filing a Chapter 7 bankruptcy is right for your situation by calling (901) 388-5805 and discussing your situation with one of our experienced bankruptcy attorneys today.