Chapter 7 Bankruptcy
Chapter 7 bankruptcy used to be the most popular form of personal bankruptcy. However the new
chapter 7 bankruptcy laws make filing a Chapter 7 bankruptcy harder
for some people. Nowadays, those who cannot file for a Chapter 7 bankruptcy will have to file for a Chapter 13
The new Chapter 7 bankruptcy law
First let us define what a Chapter 7 bankruptcy is and
why it has been so popular. In a Chapter 7 bankruptcy, the person filing bankruptcy gives
all of his or her properties to the bankruptcy court. The bankruptcy trustee appointed
for the Chapter 7 bankruptcy case will sell all properties and then distribute all
the money to the creditors.
Can the creditors still harass me after a Chapter 7 bankruptcy?
By the chapter 7 bankruptcy law, once a Chapter 7
bankruptcy is filed, the creditors cannot harass you or collect any more. Once the Chapter 7 bankruptcy trustee
appointed for your case has finished distributing the money from all the sales of your properties, the creditors
get nothing else.
Will I lose everything in a Chapter 7 bankruptcy if I file for it?
Although under a Chapter 7 bankruptcy, you are supposed to give all your assets to the
bankruptcy trustee to sell and distribute the proceeds. In reality, this rarely happens. A Chapter 7
bankruptcy is governed by 2 sets of bankruptcy laws: the federal bankruptcy laws and the state
bankruptcy laws. You need to check into the bankruptcy laws in your state. Some states allow anyone undergoing
Chapter 7 bankruptcy to keep more assets than others. A homestead exemption law, for example,
allow bankruptcy filers to keep their home.