As one of the most sought after forms of personal bankruptcy, Chapter 7 is a different process than Chapter 13 bankruptcy. Before you file your bankruptcy petition to get started, it is important to have a basic understanding of how the process works.
Chapter 7 Basics
The first part of filing for Chapter 7 is passing an eligibility test. The means test is used to evaluate your income against the median income of the state in order to determine your eligibility for Chapter 7. In order to qualify, your income must be less than the median income level of your state of residence. However, if your income exceeds the median income level of the state additional factors may be considered for further determination of eligibility.
If you are eligible for a Chapter 7 bankruptcy, you will be required to complete the bankruptcy petition detailing your finances. Information about your debts, assets, income and fund accounts will be required. Once the petition is filed with the court, you will be required to attend a 341 Meeting of Creditors. This meeting is an administrative hearing where you will be asked questions by your creditors and assigned Chapter 7 trustee. You will also be required to attend a debtor’s education course provided by a credit counseling agency.
Once you have met these requirements, the court will determine your plan for discharging your debts. A Chapter 7 bankruptcy does contain some level of liquidation in most cases. However, that isn’t to say you will lose all of your assets. Much of your essential assets, like personal property and vehicle, are protected under bankruptcy exemption laws. There are also chances that the court will not require any liquidation in order to satisfy debts. Each bankruptcy case is handled differently, depending on your unique financial standing. Always seek the guidance of a Dayton bankruptcy lawyer when pursuing help with your debts in an Ohio bankruptcy.