Chapter 7 bankruptcy offers individuals who meet specific requirements a way to eliminate their unsecured debts and achieve a fresh start. While the prospect of filing for bankruptcy can be intimidating, it can also provide much-needed relief from overwhelming debt. As such, if you are considering filing for Chapter 7 bankruptcy, you should familiarize yourself with the steps in the filing process to ensure you are prepared for the process ahead. Please continue reading as we explore what you should know about these matters and why working with our experienced Wyoming Chapter 7 Bankruptcy Lawyers is in your best interest.
What is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy, also known as “liquidation bankruptcy,” is a legal process in which an individual or business can discharge some of their financial obligations by liquidating non-exempt assets to pay off creditors. Those with a considerable amount of unsecured debts, such as credit card bills, medical expenses, and personal loans, may benefit from this process.
It’s important to note that even though this is one of the most common forms of bankruptcy, not everyone is eligible. To qualify, you must pass a mean test. This requires individuals to prove their household income is less than the median income in Wyoming. If the filer’s income falls below the state median, they will be eligible to file. If it exceeds the median, additional calculations will determine whether you qualify. If you don’t have significant disposable income to repay creditors through a repayment plan or are not looking to protect a large amount of non-exempt property, Chapter 7 may be right for you.
What Are the Steps in the Filing Process?
Before filing for Chapter 7 bankruptcy, you must complete a credit counseling course from an approved provider. This is a mandated course that ensures you have explored all other debt-relief options before pursuing bankruptcy. An attorney will then help you prepare and file a detailed petition with the Wyoming bankruptcy court. This document will include pertinent information about your debts, assets, income, expenses, and financial history.
After your petition has been filed with the Wyoming bankruptcy court, an automatic stay will go into effect. This is a legal protection that halts creditor collection efforts. This includes wage garnishments, foreclosure proceedings, and harassing phone calls. A trustee will be appointed by the court to manage your case. The trustee’s responsibilities include reviewing the petition, determining which assets are non-exempt, and ensuring that all creditors are treated equitably.
Next, you will meet with the trustee and creditors to discuss your financial situation. This 341 meeting occurs 20 to 40 days after filing. If you have any non-exempt assets, the trustee will handle selling them to repay creditors. However, keep in mind that certain property is protected under exemptions.
A debt education course must be completed prior to receiving your discharge. This course will equip you with the necessary tools to manage your finances and avoid future debt. You can expect within three to six months of filling, you will receive a discharge order. This ultimately terminates your obligation to repay qualifying debts, granting you a clean slate.
If you are considering filing for Chapter 7 bankruptcy, please don’t hesitate to contact a skilled Gillette bankruptcy lawyer from 307 Bankruptcy, who can help you determine whether it may be the right option for you. Connect with our firm today to learn how we can help you achieve your goals.
