Chapter 7
At a glance
- Chapter 7 is the quickest form of bankruptcy for most people — most filers receive a discharge about three to four months after filing.
- A trustee reviews your case; property not covered by an exemption can be sold for your creditors, but most filers keep everything they own.
- Most credit cards, medical bills, and other unsecured debts can be discharged.
- To qualify, your income must pass the means test based on your state's median income.
Chapter 7 is the quickest form of bankruptcy for most people. A trustee reviews your case, property that no exemption protects can be sold for your creditors, and most filers receive a discharge of credit cards, medical bills and other unsecured debts about three to four months after filing. To qualify, your income has to pass the means test. These articles explain the process step by step.
Understanding Chapter 7 Bankruptcy
A step-by-step walk through a Chapter 7 case with Lincoln Law, from the free consultation to the discharge, so you know what to expect at each visit.
Eliminate Your Credit Card Debt
When minimum payments no longer make a dent, bankruptcy can stop the collection calls and discharge the balances. Here is how it works.
What Is Chapter 7 Bankruptcy?
Chapter 7 can erase credit cards, medical bills and other unsecured debts in a matter of months. See what it covers, what it does not, and what the automatic stay does from the day you file.
Common Myths about Bankruptcy
Most fears about bankruptcy rest on things that are not true. This article separates the myths from how bankruptcy actually works.
Who Files Chapter 13 Bankruptcy?
Chapter 13 suits people whose income is above the Chapter 7 line, who are behind on a house or car, or who want to protect property. See who qualifies and how long a plan lasts.
Stop Repossessions with Bankruptcy
Falling behind on a car loan can lead to repossession quickly. Filing bankruptcy halts a pending repossession and, in Chapter 13, lets you catch up the missed payments over time.
How Bankruptcy Works Now
Does My Chapter 13 Payment Change With My Income?
Your plan payment is not set in stone. Learn how a plan is modified when your income falls or rises, and what happens if you cannot finish it.
Bankruptcy for Small Businesses
Bankruptcy Property Exemptions
Frequently Asked Questions
How long does Chapter 7 take?
Most Chapter 7 filers receive a discharge about three to four months after filing. The court schedules a brief meeting of creditors — called the 341 meeting — within about a month of the filing date. The discharge order typically arrives within 60 days of that meeting.
Will I lose my house in Chapter 7?
Not automatically. If your home equity is within your state's homestead exemption and your mortgage payments are current, you may keep the home by reaffirming the mortgage. If you are behind on payments and want to save the home, Chapter 13 may serve you better because it lets you catch up the overdue balance over the life of the plan.
Can I keep my car in Chapter 7?
Usually yes. Vehicle equity within your state's motor-vehicle exemption is protected. If you owe money on the car and want to keep it, you will generally reaffirm the loan and stay current on payments. A vehicle with no loan is exempt up to the statutory limit.
What debts are not discharged in Chapter 7?
Most student loans, recent income taxes, child support, alimony, debts from fraud, and criminal fines are not discharged. Credit cards, medical bills, personal loans, and most other unsecured debts can generally be discharged. A free consultation can help you identify which of your debts would survive.
Who qualifies for Chapter 7?
To qualify, your income must pass the means test. If your average income over the prior six months is at or below your state's median income for your household size, you typically qualify. If it is above, a second calculation looks at allowed expenses to see whether you have disposable income available for creditors. A bankruptcy attorney can run the calculation for your situation.
