What is Chapter 7 bankruptcy?
Chapter 7 allows you to discharge most of your unsecured debts and it has become known as the “Clean Slate” or “Liquidation” bankruptcy. It is usually the choice of people below the median income that have no assets that they need to protect.
Is Chapter 7 better than Chapter 13?
Neither type of bankruptcy is better or worse than the other. They are just used for different situations. If you have steady income and are able to pay your debts but you need more time, then Chapter 13 would be used. If you are under the median income and you have no assets that you want to protect then Chapter 7 should be your choice. In most cases, you will need to talk with a qualified Georgia bankruptcy attorney to guide you through the process and help to decide which is better for you.
Am I allowed to hold onto assets under Chapter 7?
It is up to you. You can allow the secured debt to be surrendered and the back debt will be discharged or you can reaffirm the secured debt and continue to make your monthly payments to retain ownership.
What does “reaffirming” mean?
A reaffirmation agreement is a way to make yourself liable for a debt after bankruptcy has discharged it. It can be used to retain possession of a car, for instance, by agreeing to continue making payments. It can also be used by unscrupulous companies to trick a person into indebting themselves to a creditor after the debt has been legally wiped away. You should always talk with a Georgia bankruptcy attorney before signing any reaffirmation agreement to ensure that it is above board.
Which of my debts will be discharged?
For the most part, the only debts that will be discharged are the ones that are listed on your bankruptcy schedule. Also, to be discharged the debt must have been incurred before you filed for the bankruptcy. For a more specific list, contact us for a free consultation.
Which of my debts will never be discharged?
There are a few types of debt that cannot be discharged. They include: child support and maintenance payments, student loans, past income taxes, fines and penalties resulting from criminal prosecution, debts resulting from drunk driving and debts resulting from fraud. You should contact a Georgia bankruptcy attorney for a full list of these debts.
How often can you re-file for Chapter 7?
Once you have received your discharge from a Chapter 7 case you cannot refill for another 8 years.
What are the effects of a discharged debt?
A discharge has two main effects. The first is that it voids any judgment against you for personal liability and the second it that it prevents your creditors from pursuing any debt collection action against you.
Will Chapter 7 really hurt my credit score?
Chapter 7 will actually be your first step toward repairing your credit. If you are considering filings then you have probably had a debt for over 3 months, had a repossession or a foreclosure. Any of these things can really damage your credit.