Many confuse bankruptcy as being synonymous with financial peril. While bankruptcy is a result of fiscal difficulties, it’s actually the legal savior that grants many individuals, families, and businesses new beginnings. It comes in many forms, but Chapter 7 is one of the most common and simple. It’s also referred to as “liquidation,” as resources are sold in order to pay creditors and eventually absolve debts.
Eligibility for Chapter 7 can be complex, and it’s dependent on income and expenses in relation to the qualification standards set by your state. Typically you must earn less than the median amount for a household in your state, and a required credit and budget assessment session is also mandatory for qualifying. In all cases, the process starts with a petition and continues to bankruptcy court. For the process you must be prepared to present detailed information on the following:
- Monthly living expenses
- All creditors and the amounts owed
- Employments and income
- Property and asset ownership
To protect those filing, bankruptcy law mandates that all creditors halt collection attempts as soon as an individual or business files. This is referred to as an “automatic stay,” and it also prohibits any creditors against filing fresh suits against the party filing. However, creditors can request that the “automatic stay” be lifted by a judge in certain circumstances, so it’s important to have strong legal representation. On chapter 7, individuals also have certain exemptions, meaning a certain value amount of property can not be sold by the bankruptcy trustee. For example, in Tennessee, a couple has a $20,000 exemption for personal property which allows many people to file and not lose any property.
Because of the intricate nature of Chapter 7, it’s essential to discuss your particular situation with a qualified attorney to ensure proper filing and protection. If you’re filing for Chapter 7 Bankruptcy in Chattanooga, contact the Tennessee bankruptcy lawyers with Massey & Associates, P.C. at (423) 396-0720 for a free case review today.
Gary Massey, Jr., is a well-known courtroom advocate practicing law in Chattanooga, Tennessee. Gary is a native of Tennessee who began practicing law in 1998. He graduated from Cumberland School of Law where he was ranked in the top 3% of his class and was an editor of the Cumberland Law Review.
