Chapter 7 Bancruptcy
If you are considering filing bankruptcy, you must realize that bankruptcy can negatively affect your credit for many years in the future. It may make it difficult or impossible for you to rent another apartment, or get a loan, or the like.
Chapter 7 bankruptcy stays on a credit report for seven years. Bankruptcy discharges the debt, but does not erase the existence of the debt from your credit report. You may want to educate yourself about credit reporting by checking credit report services.
Generally, folks who have consumer debts file Chapter 7 or Chapter 13 bankruptcy petitions. Chapter 7 is typically used when the person can not pay their debts. Chapter 13 is for people to have a plan to pay their debts in installments over time.
In a Chapter 7 you make a detailed disclosure of all of your assets and debts. There are exemptions up to specific limits for various items of property. A partial list of debts you may not be able to discharge includes tax debts, child support debts, or debts resulting from certain kinds of improper conduct, and criminal restitution. You many not be able to discharge debts for secured items, although sometimes these debts can be negotiated down, or you can surrender the secured item. An example of an debt that is secured might be a stereo system purchased at an electronics store. Often this type of debt is secured by the property purchased. Other such secured debts might be debts for the purchase of refrigerators, jewelry, and automobiles.
Filing a Chapter 7 bankruptcy petition makes all of your property part of the bankruptcy estate. You, the debtor may keep your property within the exemption schedules. In most Chapter 7 cases debtors assets are exempt. This is certainly true for individuals who do not have substantial assets or income. You should have an attorney carefully analyze your assets to make sure they fall within the exemptions before deciding about filing a bankruptcy petition.
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