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Bekerman Law Firm, P.C.

4600 S. Syracuse St.

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Denver, CO 80237

 

Phone: 720-324-0565
Email: bekermanlawfirm@gmail.com

Learning the Law: Chapter 7 Bankruptcy

Filing for Chapter 7 bankruptcy doesn't mean you have to file a repayment plan. Instead, your trustee collects and sells your nonexempt assets and uses the money to pay creditors. Under Chapter 7, it is possible that some of your property is subject to liens and mortgages, and you may even have to pledge your property to a creditor. However, the Bankruptcy Code allows you "exempt property," or a certain amount of property that you are allowed to keep.

Eligibility Rules for Chapter 7

According to the Uscourts.gov site, to qualify for relief under Chapter 7 of the Bankruptcy Code the following requirements must be met:

 

  1. The debtor may be any of the following:
    • An individual
    • A partnership
    • A corporation
    • Another business entity. (11 U.S.C. §§ 101(41), 109(b))
  2. Means Test: An individual debtor is subject to the means test.
  3. Individual Debt Relief Amount: Relief is available under Chapter 7 irrespective of the amount of the debtor’s debts, or whether the debtor is solvent or insolvent.
  4. No Previous Case Dismissal within 180 days: An individual cannot file a Chapter 7 case or any other Chapter if the individual had filed a prior bankruptcy case within 180 days that was dismissed due to the debtor’s willful failure to appear before the court or comply with a court order. This is also applicable if the debtor voluntarily dismissed the previous case after creditors sought relief from the bankruptcy court to recover property upon which they hold liens. 11 U.S.C. §§ 109(g), 362(d) and (e).
  5. Credit Counseling: A debtor filing for bankruptcy must receive credit counseling from an approved credit counseling agency either in an individual or group briefing within 180 days of filing. 11 U.S.C. §§ 109, 111, as noted on Uscourts.gov.
  6. Have Not Filed A Previous Bankruptcy Case Under:
  • Chapter 7 – Must wait 8 years from the previous filing date.
  • Chapter 13 – Must wait 4 years from the previous filing date.

 

Chapter 7 Discharge:

 

As per Uscourts.gov, a discharge under Chapter 7 releases the individual debtor from personal liability for most debts, and prevents the creditors from taking any collection actions against the debtor. Chapter 7 discharge is subject to many exceptions. Therefore, it is recommended that a debtor consult with competent legal counsel before filing a Chapter 7 bankruptcy. In most cases, unless a party in interest files a complaint objecting to discharge or a motion to extend time to object, the bankruptcy court will issue a discharge generally within 60 to 90 days after the date first set for the meeting of the Creditors. Fed. R. Bankr. P. 4004(c).

Would You Like to Learn More?

Individuals should consult an experienced Denver bankruptcy lawyer for advice regarding an individual situation.

 

Would you like to learn more about the Chapter 7 law? Want to know how Bekerman Law Firm, P.C. can help you? Please give me a call today.

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