Is Bankruptcy Right for You ?

Bankruptcy Fees

Foreclosure

Senior Debt Relief

Pro and Cons

Chapter 7 Bankruptcy

Chapter 13 Bankruptcy

Massachusetts Homestead Act

Chapter 7 is generally the quickest form of bankruptcy and is available to individuals, married couples, corporations and partnerships.

In a Chapter 7 bankruptcy, the court will discharge many types of debt including: credit cards, personal loans, medical bills, leases, deficiency judgments from repossessed property, and other unsecured debts. The discharge releases the borrower from all liability on the debt. Filing for chapter 7 will also put an immediate stop to any other pending litigation or collection action, such as home foreclosure, wage garnishments and vehicle repossessions.

Certain debts cannot be discharged in a Chapter 7 bankruptcy, such as alimony, child support, fraudulent debt, certain taxes, and student loans. In most Chapter 7 cases, the debtor carries large credit card debt and other unsecured bills, but owns few assets

Chapter 7 bankruptcy is also known as a liquidation bankruptcy because the Chapter 7 trustee, who is appointed by the court to administer the case, may collect assets that are not exempt under the Bankruptcy Code, sell the assets and distribute the proceeds to creditors. Most property owned by Chapter 7 debtors is either exempt or is essentially worthless for purposes of raising money for the creditors. As a result, most debtors don't lose property – but it can happen. It's a good idea to learn about the property types that can be exempted.

Not everyone qualifies for a Chapter 7 discharge. You'll qualify if your gross income is lower than your state's median income. This is known as the Means Test. If it is higher than the median, you may still qualify if, after paying allowed monthly debts, you don't have enough left over to feasibly complete a Chapter 13 repayment plan.

Chapter 7 is not for people trying to save their home from a mortgage foreclosure, or for people who are seeking to retain an asset that cannot be exempted. In those circumstances, other options – such as a Chapter 13 filing – should be considered.

This is by no means an exhaustive explanation of Chapter 7 bankruptcy law. Every case’s circumstances are different. If you find yourself looking for advice and answers, please consider seeking guidance from an attorney. The biggest benefit to you is that an experienced attorney quickly recognizes potential issues that could arise during your case and will plan accordingly.



As experienced Massachusetts bankruptcy attorneys, we would be delighted to discuss your circumstances and options with you.