Chapter 7 Bankruptcy Law

The new Chapter 7 bankruptcy law makes it so that filing a Chapter 7 bankruptcy is not what it used to be. In this Chapter 7 bankruptcy law section, we answer many personal bankruptcy questions regarding filing Chapter 7 bankruptcy and Chapter 7 bankruptcy law as applied to different situations a person filing personal Chapter 7 bankruptcy may face. With the new Chapter 7 bankruptcy law, filing a Chapter 7 bankruptcy is not always the answer. There are cases when you will lose out more than gain by filing for a Chapter 7 bankruptcy protection. Below are some disadvantages of filing a Chapter 7 bankruptcy. We break down the cons of filing Chapter 7 bankruptcy into FAQs in this Chapter 7 Bankruptcy law information.

Chapter 7 Bankruptcy Law Question #1: What happens to my equity in my house or car in a Chapter 7 bankruptcy?

Under the new Chapter 7 bankruptcy law, you may lose your house or car (depending on the state law of the state which you file the Chapter 7 bankruptcy in). If state law concerning bankruptcy doesn't allow you to keep those properties which you built up equity in, it may be wiser to file a Chapter 13 bankruptcy vs. chapter 7 bankruptcy. At least with a Chapter 13 bankruptcy, you can negotiate with the creditors on a payment plan and still keep your assets.

Chapter 7 Bankruptcy Law Question #2: what happens to my cosigner on my debts if I file a Chapter 7 bankruptcy?

If you have a cosigner or guarantor and you file a Chapter 7 bankruptcy, under the Chapter 7 bankruptcy law, it's bad news for the cosigner or guarantor. If you are the cosigner or guarantor for someone else's debt and they file a Chapter 7 bankruptcy then bad news for you. The cosigner or guarantor is often left liable for the entire debt under the Chapter 7 bankruptcy law.

Chapter 7 Bankruptcy Law Question #3: what if I don't have any assets or income to pay off my debts?

If you neither have assets nor income for creditors to see or take, then you really don't need to file for a Chapter 7 bankruptcy protection or any other types of bankruptcies. You may fall under this category if your only income is your Social security benefits or public disability income.

Chapter 7 Bankruptcy Law Question #4: what if I have the ability to pay off my debt in a few years time (qualified for a Chapter 13 bankruptcy) but I want to file for a Chapter 7 bankruptcy anyway?

If you can pay off your debt under a Chapter 13 bankruptcy plan and you are qualified to file a Chapter 13 bankruptcy but still wish to file for a Chapter 7 bankruptcy, then the bankruptcy court may require you to file a Chapter 13 bankruptcy instead of Chapter 7 bankruptcy. Use the 'mean test' to determine if you need to file for a Chapter 13 bankruptcy instead.