Chicagoland Chapter 7 Bankruptcy Attorney

Wipe out Debt

Chapter 7 bankruptcy may also be called a fresh start or an asset liquidation type of bankruptcy.  Most people do not plan to file bankruptcy.  Rather, it happens to them.  Bankruptcy is part of our Constitution and is designed by our government to assist those in need of starting over.

A Chapter 7 bankruptcy begins with filing of a petition which lists all of your assets and your liabilities.  This triggers the Automatic Stay, which stops all collection proceedings, including wage garnishments, repossessions and foreclosures.  Next, the debtor answers a few questions about their recent and current financial condition while attending a 341 meeting.  An  experienced attorney from the Chicagoland law offices of Kathryn L. Harry & Associates, P.C.  will be there to help you.  Lastly, the court orders a discharge relieving the debtor of the obligation to pay those debts that are wiped out in the bankruptcy.

The entire process, from filing a petition until the court gives you a discharge, takes about six months from beginning to end.  However, the real benefit is that all efforts to collect your debts cease.  This is a result of the Automatic Stay which takes effect immediately upon filing your petition.  Your creditors can no longer call you on the telephone, garnish your wages, repossess your car, foreclose on your house or even send you a bill.  This is a tremendous benefit to filing bankruptcy.  You immediately feel the relief from the anxiety and emotional stress related to collection calls.

Myth #1 Minimum or Maximum Debts and Income

There is no minimum or maximum amount of debt required to file a Chapter 7 bankruptcy.  However,  filers whose monthly income is above the median income established by the Internal Revenue Service must meet a means test to determine if they are financially eligible for Chapter 7 straight liquidation. In other words, the debtor's income is analyzed in relation to his debt to determine whether he qualifies for a Chapter 7; if not, the debtor must go into Chapter 13.  Either chapter is designed to assist those people facing serious financial challenges.

Myth #2 Asset Liquidation

Most people who decide to seek chapter 7 bankruptcy relief do not really suffer an asset liquidation.  Instead, there are certain types of property up to certain dollar amounts that you may keep and still go through a Chapter 7 bankruptcy.  These are called your personal property exemptions.  Under federal bankruptcy law, each state may opt to follow the federal bankruptcy exemptions or the state exemptions.  The state of Illinois, in particular,  opted to follow its own set of exemptions which may be found in the Illinois Compiled Statutes at 735 ILCS 5/12-1001. In many cases, people are able to keep their cars and their houses...even in a chapter 7 bankruptcy.

Myth #3 Public Record

Your name will not be published in the newspaper.  Usually, only large companies make the paper when they file bankruptcy. Thousands of ordinary people file for bankruptcy relief every week and escape public scrutiny.

Furthermore, your employer will not be notified of the bankruptcy, unless you need them to be as in the case of a garnishment or wage assignment.  If you want the garnishment or wage assignment to stop as a result of the Automatic stay, your employer must be notified as soon as possible or the money may continue to be taken out of your paycheck despite the bankruptcy.

Myth #4 Dismissal

In Illinois, a court could dismiss your case if you lie on your petition, refuse to appear at your 341 meeting, commit fraud by hiding assets or charging up a bunch of credit card debt immediately prior to filing your petition.  But, if you are honest and cooperate completely,  you should have no problem obtaining a discharge of your debts.

Discharge of  Debt

Generally speaking, a chapter 7 discharge relieves you of most, if not all, of your debt.  Of course, there are some debts that do not qualify to be wiped out in bankruptcy.  Debts consisting of maintenance, child support or related to criminal activity or fraud are not discharged.  This is true even if you file another type of bankruptcy, like Chapter 13.

The Illinois attorneys at Kathryn L. Harry & Associates, P.C. will examine your situation and help you decide if bankruptcy is right for you.  It is important that you discuss all aspects of your bankruptcy case with a qualified Illinois bankruptcy lawyer BEFORE filing.  Such a discussion will allow you to consider the pros and cons of bankruptcy so that you may choose the correct path for you and your particular situation. The lawyers will take the time necessary to help you understand the more complex parts of the process. They will help you put together your financial statements in the form the court wants.  They are compassionate, non-judgmental, and thorough; their experience is clearly evident throughout the process.If you feel that a bankruptcy proceeding may benefit you please consult a skilled bankruptcy attorney at Kathryn L. Harry & Associates, P.C. in Illinois to help determine your best course of action. They are experienced bankruptcy attorneys in Chicago and the suburbs that have the knowledge to help their debtor clients get out from under debt. Call for your free consultation 630-472-9700.