A Chapter 7 is a “liquidation bankruptcy.” That may sound frightening. But what it really means is that a debtor’s debts are erased and that he, or she, may have to surrender certain property which is not “exempt.” Now, “surrender” does not mean that a big constable will arrive on your doorstep with a grim face to carry off your fishing rods and tea cups! In fact, most bankruptcies are “no asset” bankruptcies: no property is surrendered to creditors because it is all exempt. This is because Federal and State “exemptions” protect the kinds of property that most people have. So, unless you own something especially valuable, you will probably keep most or all of your worldly possessions. However, if you do happen to have some gold coins glittering in your attic, or an Impressionist painting collecting cobwebs in your garage, you should straightaway tell your attorney to discuss how to deal with it.
But be weary! If you want to keep property like a house, and are behind on the promissory note, a Chapter 7 probably can’t help you much. This is because a Chapter 7 does not “wipe out” deeds of trusts, or liens. And this makes good sense. After all, folks can’t be allowed to stop paying on a house, file for bankruptcy, and then keep the house anyways. As such, the best way to keep a house which is in default is to file a Chapter 13 “payback” bankruptcy. Your attorney will be able to recommend which bankruptcy would be best suitable for you.
Something else to remember is that the bankruptcy laws were sincerely instituted to protect people in debt to give them a “fresh start.” Basically, Congress got together and decided that putting people in gruesome debtors’ prisons just because they couldn’t pay their grocers’ bills might not be the best way going forward. And so, over time, they closed the last dungeon and instead drafted the Bankruptcy Code, erasing forever much of the stigma associated with falling in debt. And really, in our day, with the bad economy, high medical costs, layoffs, and so on, bankruptcy must be regarded as an honorable option for people who have hit upon hard times.
The attorneys at Chung, Malhas & Mantel PLLC genuinely have experience, far and wide, filing bankruptcy petitions, negotiating with creditors, stopping garnishments, stopping harassing phone calls, stopping lawsuits and defending Adversary Proceedings. And we can help you discharge credit card debts, medical bills, payday loans, judgments and other unsecured debts. Our skills have been proven and our compassion is authentic. If you schedule an appointment with us for a free consultation, we fully believe that you will see how very serious we are about helping you totally vanquish your financial difficulties.
As for the mechanics, when you come to our office, we will give you a Bankruptcy Intake. Here, you will tell us your income, the kinds of debts you have, if you have filed for bankruptcy in the past, and anything else we might need to know. You must be faultlessly honest. After this, we will assess the information, and assuming you qualify, will file your petition. The petition we file will ask the Bankruptcy Court to discharge your debts, and it will be accompanied by schedules of your assets, your income, your creditors, as well as a Statement of Financial Affairs and Means Test. Taken together, the forms we prepare will give the Court a “snap shot” of your financial situation. Once this is done, the Chapter 7 Trustee will review the petition and you will be required to attend a short “341 hearing.” We will be there with you! Finally, after the 341 hearing, assuming all of the documents were in order, you may expect to receive a formal “Notice of Discharge” in the mail in a few months’ time. That is when life, free of debt, begins.
At CHUNG, MALHAS, & MANTEL, PLLC, our prudent and personable approach to bankruptcy sets us apart from other attorneys. At our firm, we don’t handle cases, we serve clients. To speak with an experienced bankruptcy attorney, contact our firm at (206) 264-8999 for a consultation.