Finance Hub

Defining Chapter Seven Bankruptcy For All Of Us

Written by finance hub on November 6th, 2008

You hear the term chapter 7 bankruptcy quite a lot these days, however normally a proper explanation of exactly what it is is not included. Sadly many folks make dreadful errors in their bankruptcy filing because of this lack of explanation.

Having to go through the proceedings necessary in bankruptcy is the last thing people want to do. Anyone who does will have to have debts that greatly exceed his or her net worth and, in addition, have no visible or viable means of paying back the debts, so they will really want to read a How To File Bankruptcy Fact or two so as to make the process easier/painful.

Numerous kinds of bankruptcy proceeding exist including but not limited to chapter 11 and chapter 7. Chapter seven is more for individuals.

Defining chapter 7 bankruptcy for all: Chapter 7 bankruptcy as defined by US and its courts law refers to the action or liquidating not legally exempt from liquidation assets with the desired outcome of paying back creditors and ebtors alike.

Chapter 7 is an option open to individuals, businesses, partnerships and corporations. It is also important to note that individuals do also have a special clause open solely to them. The special clause for the public is called a discharge. What a discharge refers to is the freeing of the individual from certain debts.

The 1st things to do when filing chapter 7 bankruptcy

On a baseline level, those filing for Chapter 7 must provide: proof of your full income as well as expenditures, proof of your existing liabilities and assets, statements for your financial affairs, copies of any expired executive contracts, and of course copies all your tax returns.

For individuals there are additional items that must be provided to the court as well. As an individual you can expect to have to supply: copies of statements of income and or employee payments, credit counseling reports etc, also students will need to supply documentation for interest payments on student loans. If you are in a situation where filing chapter 7 bankruptcy or any other bankruptcy type is a necessity, make sure you take a visit to the US courts website. If you do file for bankruptcy make sure you get a good lawyer.

Tags: bankruptcy, chapter 7, finance