Known as liquidation bankruptcy, Chapter 7 allows a debtor to rid themselves of most of their debts, giving them a fresh slate of credit. It is a type of bankruptcy both individuals and businesses can use when overwhelmed by debt and no other options provide relief. There are many important pieces of information to understand if you are considering filing for Chapter 7 bankruptcy, some of which we’ll provide to you below.
A Judge Must Approve Bankruptcy Filing
Before declaring bankruptcy, you must go before a bankruptcy judge in a federal court who can approve or deny the request to file. Most bankruptcy requests are approved, so don’t worry so much. There are a few reasons why a judge may deny the request to file bankruptcy, from failing to complete the proper requirements to lack of proper income.
Debt Counseling is Required
Debt counseling teaches you how to better manage finances in the future so you will not find yourself overwhelmed in debt. It also teaches you a variety of additional skills that can financially help you. It is required to complete, at your own costs, a court-approved debt counseling program to be eligible to file chapter 7 bankruptcy.
The Time Frame
Chapter 7 is not a lengthy process and can sometimes be completed in a month. On average, it takes about six months from the start of filing until the judge approves the bankruptcy filing. The bankruptcy can stay on your credit report for a period of up to 10 years. Under new federal rules, you can file for Chapter 7 bankruptcy protection once every eight years. Hopefully this is not something that you will need again after this first time.
Talk to a Lawyer
Bankruptcy is a very complex and complicated legal matter that the average person doesn’t quite grasp, as only expected. As such, going to court without a lawyer should never cross your mind. Without a lawyer, bankruptcy can be a bigger headache than what you bargained for. Lawyers understand the complex laws and know how to ensure that you complete the steps the right way so there is no delay in your request.
Not All Debts are Forgiven
There are several types of debt that cannot be forgiven when filing bankruptcy. This usually includes debts with the federal government such as child support and taxes, as well as student loans. Creditors have the right to object to the discharge of the debt as well. If they win the case, the debt is not discharged and you will still need to pay the money.
Put a Stop to it All
After filing for bankruptcy relief, it puts a stop to those annoying calls from debt collectors at all hours of the day and night. It also eliminates the letters that fill your mailbox so often. Creditors are not legally allowed to contact you after you have filed for bankruptcy protection. For most people, this is a great sigh of relief.
Daryl Green 
Romeo Cano