Filing Chapter 7 Bankruptcy
Filing for “Chapter 7 Bankruptcy” is an option available to any person who resides or has a domicile, a place of business, or property in the United States, but eligibility may be restricted if that person has filed one or more Bankruptcy cases under “Chapter 7” or “Chapter 13”. A “Chapter 7 Bankruptcy” case may be filed and a Discharge of debts granted by the Bankruptcy Court only once every 8 years. However, if a “Chapter 7 Bankruptcy” case was filed more than 4 years, prior, then a “Chapter 13 Bankruptcy” case may be filed. Upon completion of a “Chapter 7 Bankruptcy” case, the Bankruptcy Court will grant an Order of Discharge which cancels the filer’s personal liability for Dischargeable debts. If the monthly payments you are making on your credit cards and medical bills is not enough to repay those debts in the reasonable future, then a “Chapter 7 Bankruptcy” case may be appropriate to Discharge your personal liability for those debts and allow you to make progress financially.
One of the factors which controls eligibility to file a “Chapter 7 Bankruptcy” case is the income of your household during the 6 months before the “Chapter 7 Bankruptcy” case is filed. The Bankruptcy Court will investigate the total income during this time and may determine that the income of your household is beyond the limits required to file a “Chapter 7 Bankruptcy.” There are also some debts which are not eligible to be discharged through a “Chapter 7 Bankruptcy” case, like Child support, Maintenance owed to a former spouse, and many tax debts. If you are not eligible for a “Chapter 7 Bankruptcy” case, or if you have debts which will require repayments that you can not immediately afford, like a tax liability or a delinquency on Mortgage or car payments, then a “Chapter 13 Bankruptcy” case may provide a repayment plan for a term of 3 to 5 years where the debts are repaid through payments that you control.