Chapter 7 Bankruptcy

Chapter 7 bankruptcy is the oldest and most common form of bankruptcy. It involves liquidating some of your property in return for absolving some debts. The chapter just refers to a chapter of united states code. In terms of court costs, chapter 7 is cheap, with only a filing fee and one visit to the courthouse. Like other forms of bankruptcy, chapter 7 requires credit counseling before moving forward. Those who have the earnings ability to complete a chapter 13 will not be eligible, as well as those who already filed for bankruptcy recently.

In order to properly file, you must fill out a petition and forms that describe your property, expenses, debts, and everything you owned, sold, spent or gave away during the last 2 years. Then you will fill out what property you think should be exempt from seizure. This is an important part of Denver bankruptcy that cannot be forgotten, or your claim will be thrown out.

Once filed, the order for relief acts as an automatic stop to debt collectors from garnishing wages or taking your money or property. The court now technically owns your property for the time being. You cannot sell your property without the court's permission unless you have a Denver bankruptcy attorney find a loophole. Property acquired after the filing is not controlled by the court. To enforce its decisions and recover the maximum amount from you, the court appoints a bankruptcy trustee to look for additional property or reversible transactions. Usually the trusty will find nothing additional if you have a quality Denver bankruptcy lawyer backing you up.

There will then be a creditor's meeting where you may be asked questions by the trustee or creditors. The may have to pay for or sell new nonexempt property. Nonexempt but worthless property usually results in an abandonment of claim by the trustee for that property. Secured debts may not have the collateral seized if you are still making payments on the trust. Once this process is over, all debts are cleared except for government regulated debts.