Chapter 7 Bankruptcy

• Chapter 7 bankruptcy is also known as a liquidation bankruptcy. The bankruptcy filing will stay on your credit report for up to 10 years, so the first thing you should consider when contemplating bankruptcy is whether it is your only option. Once that is determined, you need to consult a bankruptcy lawyer. The attorney will tell you to bring all of your financial information with you to the office. You'll need: bills, bank statements, check stubs, assets, tax returns and any outstanding loans.
  
  

The Process

• Your attorney will then file a petition for bankruptcy on your behalf in court. This statement of bankruptcy must include all of your creditors. Two crucial elements that could potentially get your bankruptcy petition thrown out are lying on your petition and failing to disclose all income within the last six months. It is a federal crime to lie on your petition or hide outstanding debts. Also, your total income will determine the chapter of bankruptcy you may file.
  
  

No Absolute Debt Discharge

• There is no schedule of repayment. Rather, your nonexempt property is sold and the profits are given to creditors. Keep in mind that all of your debt may not be discharged. This means you may still have to pay some things off, even after a successful bankruptcy. Student loans and outstanding child support are two such examples. A Chapter 7 bankruptcy discharge also does not affect a lien on property. Once your bankruptcy petition is complete, your attorney will file it in District Court.