Chapter 7 Bankruptcy Laws Have Changed But Still Offer Debt Expulsion

By Author: Bly Mansi
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With the recent downturn of the economy, more people are struggling with debt, and are considering bankruptcy. If you or someone you know is considering filing bankruptcy, it is important for you to have an understanding of the Bankruptcy Laws associated with the different chapters. On the Internet, there is a plethora of bankruptcy information that can assist you in understanding which is best for you. State and federal laws protect those who are going through a bankruptcy, and are different in each state. For this reason, it is important that you have all of the bankruptcy information you can get in order to make the most informed and intelligent decision for your specific situation. New bankruptcy laws have made it more difficult for some people to completely alleviate themselves of all of their debt. However, there are still many people who can qualify for a Chapter 7 bankruptcy, which will allow them to eliminate their debt without repaying it.

In order to qualify for a Chapter 7 bankruptcy protection, generally speaking, you need to be at or below the median income level of your state. Often, Chapter 7 is solely ...
... for individuals, not businesses, and you cannot file for a Chapter 7 bankruptcy if you have filed one in the last eight years. Chapter 7 bankruptcy protection makes you accountable to a trustee. The trustee will then collect and sell any non-bankruptcy exempt property that you have, and the money will then be given to your creditors. You never make any payments to the trustee, but once your assets are sold, all of the debts that are allowed in a Chapter 7 bankruptcy following this discharge of your assets will be erased. However, it is important to note that Chapter 7 bankruptcy will not allow you to discharge back taxes and child support payments.

Under Chapter 7 bankruptcy laws, many of your assets could be sold. Each state has an individual list of assets that are exempt, and examples of those are vehicles, family heirlooms, homesteads and everyday items, such as food, clothing and cooking items. In addition, you may also be able to keep your car or your home if you have a loan against them. You will need to sign a reaffirmation, which simply says that you are going to continue making those payments on those specific loans. If you do this in the timeframe allowed by the law in your state, often, you will be able to keep those assets, depending on your individual states exemptions and equity in each asset.

The primary benefits of filing a Chapter 7 bankruptcy, is the ability for you to rid yourself of most if not all of your dischargeable debt. Most often, Chapter 7 bankruptcy is very beneficial if you have an extraordinary amount of consumer debt that you simply cannot surmount. In this way, Chapter 7 bankruptcy could give you the opportunity to start anew. If for any reason you are wondering if you qualify for a Chapter 7 bankruptcy, you can always choose to speak to a knowledgeable and qualified bankruptcy lawyer who can provide you with more information concerning bankruptcy laws and additional bankruptcy information.

Understanding the specific Bankruptcy Laws in your state can help you to make the most informed and intelligent decision for your specific situation.