Chapter 7 Bankruptcy

4 Disadvantages of Chapter 7 Bankruptcy

People often think bankruptcy is an easy way out of debt. Nothing could be further from the truth. All bankruptcies are complicated by the very nature of the process. Filing Chapter 7 bankruptcy won’t necessarily be a walk in the park, despite there being numerous potential benefits to doing so.

Sometimes the negatives of filing Chapter 7 bankruptcy outweigh the benefits. Before you dive in, first familiarize yourself with the process and potential disadvantages which may apply to you.

Possible Loss of Property

The job of the trustee assigned to your case is to look at your assets and decide if you hold any non-exempt equity in property. This equity can be liquidated in order to repay any creditors. While most Chapter 7 bankruptcies are known as “no asset” cases, keeping your property isn’t guaranteed and you should go into the process with that information in mind. Exemptions are available to protect your property from liquidation. H. Lehman Franklin, P.C. can advise you about whether or not your assets are exempt.

Lawyer and Filing Fees

The filing fee is set by statute and may not be changed, as it is a necessary charge by the bankruptcy court. There are also lawyer’s fees involved. H. Lehman Franklin P.C. charges reasonable fees for helping you through the process of filing Chapter 7 bankruptcy. In most cases, the attorney’s fees are a standard amount approved by the bankruptcy court. However, the additional moral support we provide is invaluable to clients who are going through what can be a complicated bankruptcy case. The fees typically are far less than the total amount of your debt that you would discharge in a Chapter 7 case.


If you are filing Chapter 7 bankruptcy, taking two credit counseling courses is mandatory. One course must be taken prior to filing and takes approximately 1 hour, and the other course is completed after filing bankruptcy and taxes approximately 2 hours. You can typically choose the method of taking the courses, usually either online or by phone. The courses are required by bankruptcy law and they may prove invaluable as you rebuild your credit and learn to manage your budget.


When you file for Chapter 7 bankruptcy and perfected liens are on your property, they are not removed in most cases, although you may be able to avoid judgement liens. Liens on property, such as mortgages or cars, are typical examples of liens that debtors encounter when filing Chapter 7 bankruptcy. You have the option of surrendering the collateral for such secured debts and discharging the debt. Whether this option is most beneficial to you will depend on your financial circumstance. If you wish to keep your property and can afford the payments, in most cases you can reaffirm the debt and continue paying your mortgage or vehicle loan.

There are numerous other potential pitfalls you may encounter when filing Chapter 7 bankruptcy. How your case plays out will depend entirely on your personal financial circumstances. A different chapter of bankruptcy may work better for you, or you may want to consider other options. In all cases, you should speak to an experienced bankruptcy lawyer in Georgia.

H. Lehman Franklin P.C.

If you are considering filing Chapter 7 bankruptcy but are concerned the disadvantages would outweigh any positives, seek advice and guidance from H. Lehman Franklin P.C. in Georgia. We specialize in representing the interests of people just like you. With our team of legal professionals by your side, getting through the process of a Chapter 7 bankruptcy is a much less stressful experience.

Reach out today and call 912-764-9616 or email at to learn more about the advantages of our services in Georgia.