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Overview of a Chapter 7 Bankruptcy

A Chapter 7 Bankruptcy (also known as "liquidation" or "straight bankruptcy") allows individuals and married couples to eliminate most unsecured debts. A Chapter 7 Bankruptcy is overseen by the Bankruptcy Trustee. In a Chapter 7 Bankruptcy, you are not required to pay any of the debts owed to most unsecured creditors. In regard to secured debts (typically your house and automobile loan), you can typically choose to reaffirm those specific debts. You can learn more about Reaffirmation Agreements on this site.

In the majority of Chapter 7 Bankruptcy cases, most of your debts will be discharged (eliminated) yet you will keep all of your property. Depending on the facts of your Chapter 7 Bankruptcy, there may be certain assets subject to liquidation by the Bankruptcy Trustee. We can discuss the specifics of your Chapter 7 Bankruptcy and determine if you have assets at risk of liquidation. You will receive your Chapter 7 Bankruptcy discharge from the Court approximately four months from the date the case is filed.

A Chapter 7 Bankruptcy filing triggers an "automatic stay." What that means for the Chapter 7 Bankruptcy filer is that all collection attempts must immediately stop. All creditors are compelled to cease all collection attempts. This includes any active foreclosure proceedings, garnishments, lawsuits and collection calls to your home or place of employment. The Chapter 7 Bankruptcy automatic stay remains in effect until your Chapter 7 Bankruptcy case is closed.

Finally, a Chapter 7 Bankruptcy is a proceeding under federal law. It will be filed in the United States Bankruptcy Court for the Eastern District of Missouri. Depending on where you live, your Chapter 7 Bankruptcy may be heard in Wentzville at the Wentzville Police Department, in downtown St. Louis at the Thomas F. Eagleton United States Courthouse or in Hannibal at the Hannibal Police Department.