There a lot of reasons people consider filing bankruptcy, unemployment, divorce or other marital problems, large medical expenses and overextended credit. This bankruptcy is for those who are seeking a “fresh start” and is willing to liquidate some if not all assets you may own.
The court will assign a trustee. That trustee will gather information from you. You will need to provide them with the following: 1. A list of all assets and liabilities; 2. Current income and expenditures; 3. A complete statement of financial affairs; and 4. All contracts and current leases. These will also become part of your filing with the bankruptcy court. You will also be required to provide a certificate of credit Counseling. You may also have a repayment plan in place with the when you went through credit counseling. You may also include property that may be “exempt” that fall under the bankruptcy law.
With the filing of Chapter 7, you will be required to sell your assets, that could include your car and home to pay off as much debt as possible. You will need to make sure your account all property that is owned by you, including personal property. Once assets are sold they are distributed by the court-appointed bankruptcy trustee to the creditors. Once you file the initial bankruptcy it will put a stop to almost all collections calls. Once the bankruptcy forms are filed, there is a $335.00 fee that will be paid to the court. Sometimes it can be paid in installments or even waived by the court. About 21 or 40 days after the filing, the trustee will hold a meeting with the creditors and you. You will then answer the questions regarding your financial affair and assets you own. By filing Chapter 7 the overall process can be quick and be completed as soon as 4 months. You will want to consider this bankruptcy when you have insufficient income to pay any portion of your debt.