CHAPTER (7) is generally what one thinks of when contemplating bankruptcy. It eliminates most types of debts and many people are able to keep all of their property. The most common types of debts which are not eliminated are recent taxes, student loans, and support related debts. There is a limit on the amount of property one can keep, but for most people considering bankruptcy the limit is more than what they have.

Generally, depending upon the amount of equity in your home and automobile, they can be kept as long as the monthly payments are current.

Immediately after your case is filed the court issues a restraining order which stops almost all collection actions by creditors. This means the creditors cannot contact you, or take collection actions against you, such as wage garnishments and bank account levies.

The process takes about four months and there is usually only one hearing which is about one month after the case is filed. The hearing is not held in the courtroom but in a meeting room and the person conducting the hearing is a Trustee and not a judge. Each case is normally only a few minutes and about four months after the case is filed the court will issue a Discharge Order which exonerates most debts.

If someone has, (1) very little property, (2) the type of debts that can be dealt with by a Chapter 7, and (3) is not able to make meaningful payment towards the debt, a Chapter 7 is usually a good alternative.