Chapter 7 Laws
If your debts have become insurmountable and you don’t possess a valuable asset like a home or a car, you may be eligible to file for bankruptcy protection under chapter 7 laws. The chapter 7 laws of the United States Bankruptcy Code are specifically construed to help debtors who have no material resources and a low income. If you file for bankruptcy under chapter 7 laws, you officially turn your assets over to the court.
A Trustee is appointed to oversee the liquidation of your assets under chapter 7 laws, in order to pay off your creditors with the proceeds. It is understandable that most people are intimidated at the prospect of filing bankruptcy under chapter 7 laws, but in fact, seeking protection under chapter 7 laws can actually help your financial situation in the long run.
A huge benefit of filing for bankruptcy under chapter 7 laws is that your creditors must by law stop all collection actions as soon as you petition has been filed. In accordance with chapter 7 laws, the court-appointed Trustee who oversees your case will notify your creditors and they will be invited to a so-called meeting of creditors.
Chapter 7 laws also decree that you, the debtor, must be present. During this meeting your creditors are each given the chance to object to your bankruptcy petition, which satisfies the chapter 7 laws’ intent to treat each party in a bankruptcy equally.
Chapter 7 Asset Liquidation
Another advantage of seeking protection under chapter 7 laws is that chapter 7 laws allow certain assets to be considered exempt from the liquidation process. In nearly every case, you are allowed to keep a certain amount of personal assets according to chapter 7 laws. Chapter 7 laws also allow you to keep specific saving funds and pensions, such as IRAs. This means that chapter 7 laws provide for a sufficient amount of personal safety, as well as protect capital you have built up during the years.
When the liquidation of your assets has been accomplished under chapter 7 laws, the bankruptcy court will hear your case and, if all goes well, the bankruptcy judge will issue you an official discharge under chapter 7 laws. It is clear that if you are in dire need of a way out of deep debt, seeking protection under chapter 7 laws can be your first step to rebuilding your finances and starting a debt-free future.