However, you must possess the necessary qualifications. If you do not, you may be saddled with a repayment plan you never intended to have, or you may lose your residence and other valuable assets. Therefore, it is frequently advised that you exhaust all other options prior to registering for bankruptcy. A minimum of 200 points will be subtracted from your current credit score. Check to see if you can resolve your debts in a way that is risky but less damaging to your credit before making a final decision.
The purpose of this article is to help you comprehend what Chapter 7 entails by describing the general process involved.
Everything begins with a consultation with a professional. Unlike the other options, you cannot pursue this form of debt relief on your own. You must retain a bankruptcy attorney for assistance with the entire procedure. Typically, the procedure and all the deadlines are unclear. Numerous documents must be submitted, and their creation can be difficult. A bankruptcy attorney can help you compose all the necessary documents and represent you in court.
Once you have hired a lawyer, you must provide all the requested information and not withhold any details, such as the properties and assets you wish to defend. These are violations of the law, and their exposure could have severe consequences for your petition.
You will provide an inventory of your personal properties and assets, along with the corresponding values for each. In addition, you will identify your creditors, payments made, and outstanding debt. The details of your income and employment will also be discussed.
Prior to filing your petition, you must complete a credit counseling program that has been approved by the US Trustee. This must be completed within six months prior to filing. A completion certificate will be issued as evidence that you have completed this program. This is to give you the opportunity to learn about debt relief alternatives and determine if you can opt for them. This can be accomplished via telephone, the Internet, or in person.
After the program, your bankruptcy attorney will file your Chapter 7 bankruptcy petition on your behalf. When this occurs, your creditors will be notified within 15 days that you are filing for bankruptcy. The court will appoint a bankruptcy trustee who is a federal employee to examine your financial situation and supervise the progression of your case. They will schedule the creditors' meeting, also known as the 341 meeting, where creditors can question you, object to your case, and submit their respective claims.
You must also register your Statement of Intention, which contains a list of the properties and assets you wish to retain or surrender for liquidation. You have thirty days to file this document with the court.
Every bankruptcy petitioner will also be required to complete a Debtor Education course from a US Trustee-approved organization. Similar to credit counseling, this service can be obtained via telephone, the Internet, or in person. The objective is to teach you how to properly manage your finances in the hopes that you will no longer fall so deeply into debt.
If there are no objections or complaints from your creditors and the trustee finds no reason to rule otherwise, you may be granted a Chapter 7 bankruptcy discharge. This typically occurs two months or sixty days after the petition has been lodged.
After that, it is strongly suggested that you begin restoring your life, credit, and financial situation.""
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