Ch. 7
Chapter 7 Bankruptcy
Sometimes circumstances beyond your control force you to suffer financial losses due to a recent job loss, reduction of income, illness or injury, death or other issues. When this happens, it seems the stress and anxiety of how to pay the bills is overwhelming. To further compound the stress, the bill collectors will call you with demand for payment and threaten you with garnishment, foreclosure or repossession. Bankruptcy is here to assist you.
Chapter 7 Bankruptcy
A chapter 7 bankruptcy can do the following:
- Provide a debtor with peace of mind and protection from collectors
- Stop creditor harassment and intimidation
- Stop garnishments of wages
- Stop lawsuits
- Stop foreclosure temporarily to allow possible workouts
- Stop a wage levy by the IRS or Indiana Department of Revenue
Chapter 7 is the bankruptcy that most people file. It is commonly used to discharge (get rid of) unsecured debts like:
- credit cards
- medical bills
- unsecured personal loans
- judgments
- garnishments
- repossession
- bad mortgages and foreclosures
- certain taxes owed to IRS or State of Indiana
- and other debts.
Full disclosure and the listing in your bankruptcy of all of your bills is mandatory by law. You are required to sign the Bankruptcy documents under penalty of perjury and you are required to testify under oath at a Meeting of Creditors hearing that the documents truthfully and accurately show all of your debts and all of your assets.
There are certain debts that are non-dischargeable in chapter 7 and you should be sure to discuss all of your debts with your attorney. The following types of debts may not be discharged in bankruptcy and should be disclosed to your attorney prior to filing:
- debts owed to ex-spouses for alimony and child support
- debts due to driving the under the influence
- debts based upon fraud or misrepresentation
- certain types of taxes
- court ordered fines
- student loans (except in extreme cases)
- purchases of luxury goods within 90 days of filing bankruptcy
- recent cash advances on credit cards
- and other items
