Chapter 7 Bankruptcy
In Chapter 7 bankruptcy, the debtor files a petition with the court, which includes detailed financial information about his assets, debts, and income, and a list of the assets claimed as exempt. The papers filed with the court are executed under penalty of perjury. The court process usually takes about 3-4 months.
Bankruptcy is the statutory procedure under federal law by which a person, known as the “debtor” under goes a judicially-supervised liquidation or reorganization for the benefit of those who are owed money, known as “creditors”, where the debtor is usually relieved of most of his debts through what is called “discharge”. The debtor’s property becomes what is called “the bankruptcy estate”. This federal law is commonly known as “the Bankruptcy Code”. Bankruptcy filings are all done in federal court, thus ensuring uniformity throughout the United States. Certain variations do occur from state to state relating to what assets an individual debtor is allowed to keep (“exemptions”), and as to the nature and extent of a debtor’s property interests and other matters. Therefore, debtors should consult a local Bankruptcy Attorney to ensure the best representation.
