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Georgia Chapter 7
The attorneys at the Sandberg Law Firm specialize only in bankruptcy law,
giving you access to the most qualified bankruptcy related legal assistance
available in Atlanta. The Bankruptcy Reform Act of 2005 made sweeping changes to
filing requirements and eligibility standards, making it harder to qualify and
more difficult to file.
Now, more than ever before, finding an attorney that knows all the ins and
outs of the bankruptcy system is vital to winning your case. You should only
rely on the advice of a quality bankruptcy attorney, like those you’ll find
at the Sandberg Law Firm.
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Chapter 7
• No assets to protect
• You cannot pay minimum payments on current debts
• Wipes out debts for a fresh start
• In some cases you can keep property under finance, such as a
vehicle
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Background
A chapter 7 bankruptcy case does not involve the filing of a plan of repayment
as in chapter 13. Instead, the bankruptcy trustee gathers and sells the debtor's
nonexempt assets and uses the proceeds of such assets to pay holders of claims
(creditors) in accordance with the provisions of the Bankruptcy Code. Part of
the debtor's property may be subject to liens and mortgages that pledge the
property to other creditors. In addition, the Bankruptcy Code will allow the
debtor to keep certain "exempt" property; but a trustee will liquidate the
debtor's remaining assets. Accordingly, potential debtors should realize that
the filing of a petition under chapter 7 may result in the loss of property.
Chapter
7 Eligibility
To qualify for relief under chapter 7 of the Bankruptcy Code, the debtor may be
an individual, a partnership, or a corporation or other business entity. 11
U.S.C. §§ 101(41), 109(b). Subject to the means test described above for
individual debtors, relief is available under chapter 7 irrespective of the
amount of the debtor's debts or whether the debtor is solvent or insolvent. An
individual cannot file under chapter 7 or any other chapter, however, if during
the preceding 180 days a prior bankruptcy petition was dismissed due to the
debtor's willful failure to appear before the court or comply with orders of the
court, or the debtor voluntarily dismissed the previous case after creditors
sought relief from the bankruptcy court to recover property upon which they hold
liens. 11 U.S.C. §§ 109(g), 362(d) and (e). In addition, no individual may be a
debtor under chapter 7 or any chapter of the Bankruptcy Code unless he or she
has, within 180 days before filing, received credit counseling from an approved
credit counseling agency either in an individual or group briefing. 11 U.S.C. §§
109, 111. There are exceptions in emergency situations or where the U.S. trustee
(or bankruptcy administrator) has determined that there are insufficient
approved agencies to provide the required counseling. If a debt management plan
is developed during required credit counseling, it must be filed with the court.
One of the primary purposes of bankruptcy is to discharge certain debts to give
an honest individual debtor a "fresh start." The debtor has no liability for
discharged debts. In a chapter 7 case, however, a discharge is only available to
individual debtors, not to partnerships or corporations. 11 U.S.C. § 727(a)(1).
Although an individual chapter 7 case usually results in a discharge of debts,
the right to a discharge is not absolute, and some types of debts are not
discharged. Moreover, a bankruptcy discharge does not extinguish a lien on
property.
For more information about
chapter 7 bankruptcy, click on
Chapter 7 Bankruptcy Basics.
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