If it’s the best available option, a Chapter 7 can help you. If bankruptcy is necessary and appropriate under the circumstances, the choice for most individuals would be whether to file a Chapter 7 case or a Chapter 13 case. Many debtors prefer filing a Chapter 7 bankruptcy case over a Chapter 13 case because it takes less time and doesn’t require a repayment plan, while still discharging most debt. However, a Chapter 7 bankruptcy does require debtors to meet an income limitation and does not catch up on mortgages and vehicle loans.
An individual that qualifies for a Chapter 7 may have his or her debt discharged but must surrender nonexempt property to the Chapter 7 bankruptcy trustee to sell to pay creditors. Although a Chapter 7 bankruptcy debtor may have to liquidate and lose some property, most cases do not involve the sale of property and there are several ways a Chapter 7 bankruptcy can significantly and substantially help debtors solve financial stress and hardship.
A Chapter 7 bankruptcy case can achieve the following:
- Eliminate excessive debt
- Stop lawsuits
- Stop repossession
- Stop garnishment
- Stop contact with creditors
- Help repair and restore credit
- Allow a “fresh start“
A debtor has the opportunity to start over with a Chapter 7 bankruptcy. If you have discharged debt you can avoid personal liability for that debt. In most cases, any property the debtor purchases or plans to purchase once he or she has filed a Chapter 7 bankruptcy is not included in the bankruptcy estate.
A debt limit does not apply when a Chapter 7 is filed by the debtor. However, a debtor is not eligible for a Chapter 13 when secured or unsecured debt exceeds the cap that is stipulated by the statute. A debtor may receive a discharge within six months under a Chapter 7. The Chapter 7 trustee must distribute the debtor’s nonexempt property to unsecured creditors so that the bankruptcy court is able to close the case.
Keep in mind that some types of debt are not dischargeable, including student loans, child support, alimony, certain taxes, and debts incurred by fraud. Certain property liens like a mortgage, a tax lien, or mechanic’s lien remain in full legal effect after the debtor receives a Chapter 7 discharge.
Determining whether you qualify for a Chapter 7 bankruptcy filing is not always a simple analysis and typically requires the assistance of an experienced Georgia bankruptcy attorney. H. Lehman Franklin has helped those seriously affected by financial hardship in the Statesboro community for over 50 years. Along with a capable and dedicated support staff, attorneys H. Lehman Franklin and Kimberly Ward offer quality and zealous representation on behalf of all of their bankruptcy clients. Don’t hire just any bankruptcy lawyer to file your case. You need a lawyer like Lehman Franklin or Kim Ward who have 65 years of collective experience filing bankruptcy cases. If you’re in need of our services and would like a FREE consultation, give us a call, send us an email or simply check us out online.