If you are looking to file a personal bankruptcy claim then you really only have 2 options – you can file through Chapter 7 or through Chapter 13. If you are like a majority of bankruptcy candidates then you will probably elect to file under Chapter 7. Before making that determination, however, you must first understand the major differences between the two most common types of bankruptcy. Fortunately we have the Chapter 7 bankruptcy information you need and we also offer a free bankruptcy evaluation that you can use to determine your best course of action. Read on for information related to bankruptcy information for low income individuals.

Commonly referred to as “liquidation bankruptcy” or “straight bankruptcy,” Chapter 7 bankruptcy involves the court-supervised liquidation of assets to pay back creditors. In other words, a debtor’s non-exempt assets are turned into cash which is then distributed to their creditors. Click on the following link for a complete Chapter 7 bankruptcy definition. Rather than go into the specifics of filing a claim, which can be found through our comprehensive guide on how to claim bankruptcy, we’ve decided to cover some of the most frequently asked questions regarding Chapter 7 bankruptcy –

• How Do I Qualify For Chapter 7 Bankruptcy? – In order to qualify for any form of personal bankruptcy you must first complete what is referred to as a “means test.” Essentially, this test will determine if your income is low enough to qualify you for bankruptcy protection. A bankruptcy means test is also meant to prevent debtors with higher incomes from filing. Of course, this doesn’t mean that you need to be completely penniless in order to qualify, as qualification will depend on your debts and expenses in addition to your income.

• Will My Creditors Stop Harassing Me? – Yes, your creditors are required by law to avoid contacting you once documents have been filed. This means that creditors cannot contact you by mail, in person or even by phone.

• How Can I Prepare For Chapter 7 Bankruptcy? – Before you file you must complete credit counseling, which is designed to educate debtors on proper money management. If you know that you qualify to file a bankruptcy claim then it might make sense to enroll in an approved credit counseling course prior to filing bankruptcy. You should also consult with a financial professional prior to filing a claim to ensure that bankruptcy is the best course of action. You can find a list of approved credit counseling agencies through the U.S. Trustee Program.

• Do I Need A Chapter 7 Bankruptcy Lawyer? – No, you don’t need a lawyer; however, there are many advantages to working with one if you decide to move forward with the bankruptcy process. Bankruptcy can be intimidating and stressful, which is why it makes sense to hire someone that can provide assistance and reassurance throughout the process. Bankruptcy attorneys can provide you with legal advice and representation and they can also assist with the time-consuming process of filling out paperwork.

• What Happens After I File Chapter 7? – Once your claim has been approved and your assets have been liquidated to pay back your creditors, your remaining debt will be discharged within a period of 4 months. Because most debtors won’t have significant assets they will be able to quickly get on with their lives.

• What Are The Major Disadvantages To Filing Chapter 7? – Perhaps the most significant disadvantage is that your credit rating will take an enormous hit, which will make it almost impossible for you to borrow money at a reasonable rate for a period of up to 10 years. Of course, there is also the pain and embarrassment that comes with claiming bankruptcy, which can be significant for some debtors.

For more Chapter 7 bankruptcy information and for a complete guide on how to go bankrupt responsibly, please feel free to browse our comprehensive website. Please click on the following link to learn about converting Chapter 13 to Chapter 7.

Click on the following link for a list of the pros and cons of bankruptcy Chapter 7.