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Chapter 7 Bankruptcy

Chapter 7 Bankruptcy

What is Chapter 7 Bankruptcy?

Deciding whether to file for chapter 7 bankruptcy can be a stressful and challenging one. For informational purposes, bankruptcy information is presented below. This is not legal advice and we recommend that you speak with a licensed attorney for legal related questions.

Chapter 7 bankruptcy is categorized as a liquidation. What does liquidation mean? It means that in the chapter 7 bankruptcy process, the debtor’s (you) non-exempt assets, are sold by the Chapter 7 trustee. The earnings on the sale of your non-exempt assets are given to your creditors based on the priority which is established in the bankruptcy court.

Wow, that’s a lot of information to process. So let’s just break it down in more simple terms. If you file for Chapter 7 bankruptcy and you have non-exempt assets, they may be sold in order to compensate creditors.

What constitutes a non-exempt asset? Your state’s bankruptcy law determines that. You are allowed to keep a certain amount of your assets, but if your assets are valued over what the non-exempt law limits then it is subject to the bankruptcy trustee’s decision to sell or abandon it.

Remember that the Trustee makes a percentage of the proceeds from the sale of your non-exempt assets, so he/she is pretty motivated to sell any asset with a amount of equity.

Ok so now you understand what a Chapter 7 bankruptcy is. Now let’s take a look at what makes someone eligible to file Chapter 7 bankruptcy.

Am I eligible to file Chapter 7 bankruptcy?

First of all, if you have filed bankruptcy before, you need to consult your state’s bankruptcy laws to see what the cutoff date is before you can file Chapter 7 bankruptcy again.

If you have never filed bankruptcy then the first step in figuring out whether you can file for Chapter 7 bankruptcy is to compare your monthly income to the median income for an individual like yourself/a family like yours in your state.

If you make less or the same as the median income in your state then you are eligible for Chapter 7 bankruptcy (assuming you meet all other Chapter 7 bankruptcy eligibility requirements in your state).

If you make more than the median income then, by requirement of the bankruptcy law, you will have to pass “the means test” in order to file Chapter 7 bankruptcy.

''What is the means test?''

The means test is designed to check your disposable income. The higher the disposable income, the less likely you are to be eligible to file Chapter 7 bankruptcy.

The means tests subtracts specific monthly expenses from your monthly income (your current monthly income is calculated over the six calendar months before you file for bankruptcy) to arrive at your monthly “disposable income.”

So if your disposable income is high, then, yes, you might not be eligible to file for Chapter 7 bankruptcy.

How long does a Chapter 7 bankruptcy stay on my credit?

A Chapter 7 bankruptcy may stay on your credit report for 10 years. Now, this does not mean that you won’t be able to get any sort of credit before the 10 years. It does mean, however, that it will be more difficult and interest rates will be higher.

Chapter 7 Bankruptcy or Debt Settlement?

Filing a chapter 7 bankruptcy instead of debt settlement might look easier. But our job at CuraDebt is to inform you so that you can make an educated decision.

If you are looking to file chapter 7 bankruptcy then you are probably already behind on your debts. You are probably getting calls from creditors, they might be calling you at work, and they might even be calling your family if they have their phone numbers.

The pressure to take immediate action is there. If you enter into our debt settlement program your creditor calls would be directed towards us, a special purpose account would be set up, and you would start saving money monthly.

Once you have enough money in your special purpose account, settlements are finalized. The process repeats until all are resolved.

Once all of your unsecured debts are settled you can focus on building your credit.

CuraDebt can help!

Whether behind on payments or current on monthly payments people file for chapter 7 bankruptcy. Although debt negotiation seems the logical choice, our job at CuraDebt is to inform in an unbiased way about your various debt relief options.

At CuraDebt we have: over 15 years of experience working with people just like yourself. People who are not bad, but have just come into a financial crisis.

At CuraDebt we have hundreds of five-star ratings on online review sites and are rated highly among the best debt relief companies. In addition to unsecured debt, we also can help with tax debt relief.

Contact one of our counselors today and find out why we have such stellar ratings.

A Real CuraDebt Review

CuraDebt has received more Five Star reviews with testimonials in Customer Lobby than all other debt settlement companies.

“Curadebt is the best alternative to filing bankruptcy. I wish I had known about this service several years ago.

Everyone is very courteous and friendly and very much customer oriented. You listen to the customers and that makes the big difference. I would definitely recommend Curadebt to my friends and family. Thank for you, thank you.”

– Victoria C. Greenville, NC (07/12/2015)

See more at CuraDebt reviews on Customer Lobby. Customer Lobby is a highly rated 3rd party company that allows clients of a company to post verified and authentic reviews. Their reviews are from real clients and their rating is from 0 stars being the lowest and 5 being the highest.

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