In wake of the economic slowdown in the United States of America, it is not rare to hear about bankruptcies - both personal and corporate. Bankruptcy, in simple terms, refers to a legal process which deals with the financial and debt related problems of an individual or an organization.
Chapter 7 Bankruptcy - What You Need to Know
In wake of the economic slowdown in the United States of America, it is not rare to hear about bankruptcies - both personal and corporate. Bankruptcy, in simple terms, refers to a legal process which deals with the financial and debt related problems of an individual or an organization. In the United States, bankruptcy is broadly classified as under Chapter 7, 9, 11, 12, 13 and 15. Majority of the bankruptcy cases are filed under Chapter 7, 11 and 13. Section one of the bankruptcy laws in the country comprise Chapter 7, 11, 12 and 13 while the second section includes Chapter 7, 9, 11 and 12. In this article, you will learn about Chapter 7 which is undoubtedly one of the most important chapters of the bankruptcy laws.
Chapter 7 bankruptcy is more commonly used by individuals who may have fallen under debt. Chapter 7 is technically referred to as Liquidation under the Bankruptcy Code. According to this technical definition, the assets of the person filing under this chapter will be sold and auctioned to repay the debt amount. An individual may file for the Liquidation under the Bankruptcy Code as long as he has not denied appearing before the court. The debtor is also required to meet a credit counselor one hundred and eighty days (180 days) before filing his petition.
The biggest consequence of filing a Chapter 7 Bankruptcy is the loss of assets including property. The court charges a case filing fee which amounts to about $300. To file the petition itself, the debtor is obliged to keep records of all its creditors to reproduce, exposure amount, his annual income, assets, etc. Details. The debtor would also be required to present the proof of his monthly expenses, including telephone bills and taxes. However, there are a number of alternatives to this chapter. These include Chapter 11 and Chapter 13.
Roland Poitevin is a dedicated writer with a passion for business and environmental issues.
Roland Poitevin is a dedicated writer with a passion for business and environmental issues.
You can check out his new website at Pool Lounge Chairs, which helps people find the best Outdoor Pool Furniture and information they are looking relating to this subject.
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