Chapter 7 bankruptcy stops collection activity and wipes out unsecured debt. It stops foreclosure and repossessions.
It allows you to return cars and houses without owing a deficiency balance.

Some debts are not discharged in a Chapter 7 bankruptcy such as child support, alimony, accidents where drugs or alcohol were involved, criminal court debt, most student loans and taxes.

Chapter 7 is designed to wipe out debt and give you a fresh financial start. It is important to list everyone you owe in a Chapter 7. If a debt is not listed, it is not discharged. You can eliminate check cashing debt and payday loans, credit card debt, medical debt, court judgments for car deficiencies and other debts in a Chapter 7, but they must be listed.  Credit card debts incurred within 70 to 90 days of filing may not be discharged.

You can often keep your house or car in a Chapter 7. We help you look at the amount of equity in your house or car to decide if it would be taken by the Trustee and sold for your debts. Also, you must be current in your payments on the car or house to keep it in a Chapter 7. We can protect between $5000 and $25,000 in equity for your home. On cars and your other personal property, the Bankruptcy Code and Tennessee exemptions protect $10,000 for an individual and $20,000 for a couple of personal property — cars, cash in the bank, furniture, art, jewelry and other assets.

Exemptions are amounts set out by law to allow you to protect up to a certain dollar amount of assets. We can protect up to $1750 in tools of the trade for filers that are self employed. (For example, paid for computer, lawnmower, drills, hand tools.)

Congress set out the Means Test to determine if you are eligible to file a Chapter 7.  We must look at your income, family size and certain costs of living to determine if you qualify under the Means Test to file a Chapter 7.  Some clients who qualify for a Chapter 7 under the Means Test still file a Chapter 13 to keep an asset where they are behind on the payments — such as a house or car.

Qualified retirement accounts are protected in Chapter 7 Bankruptcy. (These include 401k and IRA’s) You may wish to consider filing bankruptcy before using your retirement plan to pay debts.

Chapter 7 stops garnishments, bank account levy, check cashing loans, repossession and collection calls. It gives you relief from the phone calls and letters from your creditors. It can relieve the pressure of juggling the pay day loans, car payments and credit card bills.