One of the most commonly filed forms of bankruptcy for individuals is chapter seven bankruptcy. It is also known as straight bankruptcy, and is the simplest and quickest form of filing. This is when a person gives up their property to a creditor so that it can be sold with the money going toward their debts. This is how creditors receive the money they are owed, and a person is able to dispose of their debt. There are certain pieces to a person's property that may be exempt from being taken. These non-exempt properties cannot be taken by anyone to be resold for decreasing the debt owed.
In return for liquidating their property, a person is then granted a reprieve of some of the debt. However, like with any form of bankruptcy, a person is not entitled to a reprieve of any debt if they are found to have committed some form of fraud when filing for chapter seven bankruptcy. They are also not relieved of certain debt, such as student loans and child support. Some of the exempt property includes clothing, an older car, and household goods such as food. These things cannot be taken from a debtor to help in the payment of the debt they owe.
A person can only file for chapter seven bankruptcy once every eight years. The language of filing for bankruptcy is designed to be confusing to the common individual. A consultation with an attorney may be the best way to understand what is being said, what is expected of you and what you are entitled to keep when filing. The only way to be sure you take care of everything necessary and are on the right track to pulling yourself out of the bankruptcy hole is through the help of a knowledgeable attorney. Without their help, one may get lost in the bankruptcy rhetoric.
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