Chapter 7 Bankruptcy is also referred to as a “liquidation” bankruptcy or a “straight” bankruptcy. Most forms of unsecured debt will be discharged in a Chapter 7. This means you will not have to pay any of these debts back. Common types of unsecured debts include credit cards, medical bills, deficiency balances on repossessed cars, payday loans and personal lines of credit.
Filing for Chapter 7 Bankruptcy immediately stops all garnishments and all lawsuits. Once you have filed nobody will be able to garnish your wages or file or continue a lawsuit against you. Creditors will not be able to continue to collect any debts from you. This includes sending collection letters or calling you on the phone.
Most of your property is usually exemption in Chapter 7 Bankruptcy, meaning you will not have to give up the property. You can commonly keep your house, your car, your retirement savings and all of your personal belongs while filing Chapter 7. However, there are some exceptions for some clients. You should contact our office at (602) 956-1161 to speak with our Bankruptcy Attorneys to discuss your specific case.
We are able to file Chapter 7 Bankruptcy in Phoenix, the surrounding cities and most of the entire state of Arizona for the majority of our clients. However, you must qualify to be able to file Chapter 7. For instance, you cannot receive a Chapter 7 Discharge (the end result of a Chapter 7 filing) if you received another Chapter 7 Discharge in the previous 8 years. You must also pass what is called the “Means Test.” The Means Test limits who can file Chapter 7 to a certain income threshold. Generally, your household income must be below the median household income in Arizona. Even if it’s not there is still another way to pass the Means Test, but our Bankruptcy Attorneys must do a detailed calculation of your income and expense to find out.
Even if you don’t qualify for Chapter 7 Bankruptcy (but most do!) we do have other bankruptcy options for you. If you received a Chapter 7 Discharge in the previous 8 years or make too much money for a Chapter 7 then Chapter 13 Bankruptcy may provide you the relief you deserve. Our Bankruptcy Attorneys can give you the options you need to make the best decision for yourself. We may not tell you what you want to hear, but we will tell you what you need to hear!