Filing for chapter 7 bankruptcy can relieve an individual most of his/her debts and work on rebuilding finances anew. This kind of bankruptcy is also called liquidation or straight bankruptcy. When an individual files for Chapter 7 bankruptcy, his assets are sold off to pay the outstanding debts. Whatever cannot be recovered is written off and the debtor is able to start all over.
There were changes in 2005 on Chapter 7 relief which makes it harder to qualify for this kind of bankruptcy. The rules for filing bankruptcy vary on the kind of bankruptcy you are filing for. Getting legal assistance can help you get more information on bankruptcy and how to file for it.
You must pass the ‘means’ test to qualify for chapter 7 bankruptcy. It is also likely that the court will convert a chapter 7 bankruptcy to chapter 13. Individuals who accrued debts when running...