Chapter 7 Bankruptcy Filing - Knowledge Can Reduce Fear

Chapter 7 Bankruptcy Filing - Knowledge Can Reduce Fear "If you intend to file for bankruptcy, you may be required to file under Chapter 7 or you may choose to do so. If you are a business, this means that the business will immediately cease operations and a Chapter 7 Trustee will be appointed to liquidate all assets and distribute the proceeds to creditors. It may or may not result in the loss of employment for your employees. Sometimes, when a company is sold, it is retained intact or partially intact, and operations may continue as usual, albeit with a new leader.Chapter 7 is also available to individuals. This will indicate that you can retain certain exempt property. However, certain liens, such as real estate mortgages, will be preserved. The trustee will liquidate all non-exempt assets to pay back the creditors. This will result in the cancellation of all of your other categories of unsecured debt. Even though the majority of other forms of unsecured debt are canceled, you will still be responsible for a few. This includes child support, the majority of taxes, the majority of student loans, and any penalties or restitutions for crimes you may have committed.If you file for bankruptcy, the majority of your debts will be discharged, allowing you to start over. Obviously, all of your valuable possessions will have been sold, so you will need to start over in this regard as well. A further disadvantage is that the bankruptcy will remain on your credit report for ten years. It's possible that you won't be able to obtain loans or other forms of credit, but this could also occur with large debts.Before filing for Chapter 7, you should consider a number of factors. In some instances, you may be able to avoid filing on the premise that it is abusive. You may be able to choose Chapter 13 instead, which allows you to repay some or all of your debts over a longer period of time without having to liquidate your property and assets.
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