The Law Office of Nima Taherian provides individuals and small businesses with legal representation in Chapter 7 bankruptcy filings. Filing under Chapter 7 enables individuals and businesses to discharge their debts (so they no longer have to pay the creditors) and gain a fresh financial start. Under Chapter 7, you are typically allowed to keep property classified as exempt, such as a primary residence.
For many individuals, all assets are exempt and their debt can be fully discharged. If you do have non-exempt assets, most of your remaining unsecured debts are likely to be discharged after the non-exempt property is distributed to creditors. Debt discharge releases you from personal liability and prohibits creditors from taking collection actions on those debts, including contacting you via telephone, email, or mail. Some debts are non-dischargeable, including education loans and court-ordered child support payments. Businesses filing under Chapter 7 usually liquidate all assets and cease operations after the discharge.
A Chapter 7 bankruptcy is an attractive option for individuals because of the ability to discharge unsecured debt, such as credit card payments and medical bills. Not all debts, however, are dischargeable under Chapter 7. If your non-dischargeable debts are too substantial and you have steady income, a Chapter 13 payment plan may be your most viable option. A Chapter 7 discharge may enable you to emerge debt-free or, in the alternative, be able to live with your remaining obligations.
Liquidating your assets may seem daunting and drastic, but the law exempts certain assets from sale. You may be able to file a “no-asset” bankruptcy and avoid selling your assets while still receiving a discharge of debts. Chapter 7 is most often the optimal choice for consumers with large amounts of unsecured debts and low incomes that prevent them from following payment plans.
A common misperception is that the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act made it extremely difficult to qualify for bankruptcy. However, this law was aimed more at regulation to prevent abuse, while still enabling filing for individuals demonstrating need. To file under Chapter 7, you now must complete a means test that measures your debt and income to determine your eligibility. Even if you do not pass the means test, you may still have other filing options, especially if the majority of debt is from credit cards. For those ineligible to file Chapter 7, Chapter 13 is still usually available.
Filing your petition involves many procedural steps, including filing your schedule of assets and liabilities, current income and expenses, statement of financial affairs, tax returns for the most recent tax year, certificate of credit counseling, and any debt repayment plans developed through credit counseling. Filing the bankruptcy petition will typically stop most collection actions made against you or your property. We understand the importance of giving you some immediate relief from creditors while continuing to guide you through the remainder of your filing.
We guide our clients through all of the necessary steps to help you obtain the relief you need, including gathering information about your debts and assets, filing the bankruptcy petition, and representing you at the first meeting of creditors. If you have additional questions about filing, visit our frequently asked questions page. If you need to assess your financial options with the advice of an experienced bankruptcy attorney, contact the Law Office of Nima Taherian today for a free consultation.