Chapter 7 Consumer Bankruptcy | Here is What You Should Know

If you are someone who has debt piling up and there is no feasible way for you to pay off that debt, there is a very good chance that you are now considering your legal options going forward. While most people do not want to imagine the day where they have to file for bankruptcy, in many cases, Chapter 7 consumer bankruptcy is their best option to start anew. Read on and reach out to our Rockland County bankruptcy attorney to learn more.

What are the qualifications for Chapter 7 consumer bankruptcy?

Chapter 7 bankruptcy can be both for consumers and for businesses. In a Chapter 7 consumer bankruptcy, an individual will liquidate his or her assets and use the proceeds to pay off creditors, leaving them virtually debt-free. To qualify, you must pass the means test. As long as your income is lower than the median income of a comparable household in New York, you should qualify.

What is the Chapter 7 consumer bankruptcy process like?

Once you file your petition for bankruptcy, in which you will include various documentation regarding your financial situation, such as information regarding your debts, your yearly income, the monthly cost of living in your home, and a list of your assets, you will then trigger an automatic stay. This means that all collection activities, including foreclosure, will automatically come to a halt. Your assets will then be sent to a bankruptcy trustee. From here, you, your attorney, and the trustee will attend the Meeting of Creditors, where your finances will be discussed, and it will be determined whether Chapter 7 bankruptcy is your best option going forward. If the Meeting goes as planned, you will receive a bankruptcy discharge from the Bankruptcy Court, and all dischargeable debt will be wiped away.

Will I lose all my assets after filing for Chapter 7 consumer bankruptcy?

No. You can keep certain assets, such as up to $10,000 in value of household goods, $11,000 in your bank account, and, if your car is worth any less than $4,200, you may keep your car as well. You can also keep your wedding ring and your television set. Pension plans, IRAs, and 401(k)s are also exempt up to $1 million. Each spouse is also permitted to keep $165,000 in equity for their home from New York City to Rockland County.

Contact our experienced Rockland County, New York firm

The Law Offices of Allen A. Kolber, Esq. effectively represents clients facing Bankruptcy in Rockland County and all of New York State. Our firm understands the stress one can feel when facing a difficult financial future. Our compassionate staff will work to ease your fears and help you make a new start. If you need quality legal support, contact The Law Offices of Allen A. Kolber, Esq.