How Does A Chapter 7 Bankruptcy Work?

: Reese Baker & Associates

  Filed under: Chapter 7

ch 7No one should ever enter into bankruptcy proceedings without a full understanding of what it entails. There are some that think that under a Chapter 7 Bankruptcy that all of their debt will be totally wiped away and none of their assets will be at risk. The first step is to seek out the advice of a Houston bankruptcy attorney. You want to choose a lawyer that specializes in this area of the law specifically because of their vast experience.

It has to be determined first if the individual is eligible to claim bankruptcy under Chapter 7. There are non-exempt assets that could end up being liquidated in order to pay off some of the creditors. Who gets paid what is determined by the bankruptcy regulations. In many cases the majority of assets are exempt and the creditors end up with nothing. This should not be automatically assumed to be the case however, and this is why the expertise of a bankruptcy attorney is needed to maximize your asset exemptions.

In general individuals, married couples as well as corporations and partnerships can utilize the Chapter 7 Bankruptcy provisions, provided they meet the criteria of the means test. If not, then their only other recourse will be a Chapter 13 bankruptcy proceeding. Your bankruptcy attorney will require a great deal of information, and it is highly important that you are totally honest and forthcoming with what you are asked to provide.