In the last 25 years, consumer and business debt has soared in the US and along with it the rate of bankruptcy. These distressingincreases prompted some members of Congress to call for reforms to the bankruptcy system making it harder for consumers to file bankruptcy and directing more of them into Chapter 13 plans in which some or all of their debt is repaid. Debtors seeking to file bankruptcy must now meet specific criteria before they will be allowed to file Chapter 7, or absolute bankruptcy. Bankruptcy lawyers in Vancouver can help you understand these new reforms and where they fit into your plans.

Here’s a quick checklist of Chapter 7 facts:
If your common current monthly income over the last six months is below or equal to the median income for your state, your are eligible to file for Chapter 7. Otherwise, you will have to file Chapter 13 or the “wage earner’s plan” where some or all of your debts must be repaid. If you are a disabled veteran whose debts were acquired during active duty, you may file Chapter 7. If you have filed Chapter 7 in the last 8 years or Chapter 13 in the last 6 years, you cannot file Chapter 7.

You cannot file Chapter 7 if, in the last 180 days, either a Chapter 7 or Chapter 13 filing was dismissed because you :
o Requested a dismissal
o Committed fraud in your filing
o Violated a court order

Before filing, mandatory credit counseling must be completed with an approved agency. Vancouver Park bankruptcy advocates maintain a complete list of these agencies. A Chapter 7 filing will cost $274 and take about 4 to 6 months until debts are discharged. Attorney fees will be additional. A bankruptcy trustee is assigned to each case. This trustee has control over all assets and debts. The trustee’s staff will determine if any assets should be nonexempt. Those assets must be surrendered or sold, the proceeds going to creditors. A creditor’s meeting, scheduled by the trustee, gives creditors a chance to question the debtor as to the condition of collateral for secured debts. Once all conditions of the bankruptcy are met, the debtor must attend mandatory budget planning with a government approved agency. When all counseling is complete, all remaining debts are discharged. At this point, the debtor is no longer legally responsible for those debts. A Chapter 7 bankruptcy will remain on credit reports for 7 years, affecting credit, interest rates, insurability, and sometimes employment.
If you believe that Chapter 7 is the proper plan for you, contact Vancouver bankruptcy lawyers for an appointment.

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