The COVID-19 pandemic has impacted all aspects of our lives. For most people, especially those who own “non-essential” businesses, the financial impact of the coronavirus is felt deeper than others as their debt grows. Although everyone’s debt situation is different, for some bankruptcy may be the only option to control their financial situation.
If you believe bankruptcy is your only option, you need to realize it is not a one-size-fits-all solution. There are different types of bankruptcy “chapters” that you can apply for to help solve your unique debt problems. With the help of an experienced Central Valley bankruptcy attorney, you can find the right bankruptcy option to help eliminate your debt and help you get a new start.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is the most common type of bankruptcy because it allows you to gain financial freedom from the debt you have incurred in the most efficient way possible. Chapter 7 is designed to eliminate unsecured debt, which is any debt that is not attached to a material form of collateral.
Chapter 7 bankruptcy is the quickest and easiest option for achieving a debt-free future because it allows you to clear your debt in as little as four months. Although you may not be able to wipe out all types of debt, you can eliminate most debts you have incurred.
Debts Eliminated Under Chapter 7 Bankruptcy
Depending on your specific situation, the following unsecured debts may be eliminated under a Chapter 7 bankruptcy filing:
- Credit card debts
- Medical bills
- Personal loans
- Payday advances
- Student loans
- Utility bills
- And more
Keeping Assets in Chapter 7 Bankruptcy
Once you file Chapter 7 bankruptcy, you open the door to creditors ceasing some of your assets. Any property or asset you own will become part of your “bankruptcy estate” when you file bankruptcy. This means the court, instead of you, will own these assets. However, you are allowed to keep specific exempt property to ensure that you have everything you need to live and to start afresh.
Some common types of property you can keep in Chapter 7 bankruptcy include:
- Retirement accounts
- Other property that is necessary to work
Call an Experienced Central Valley Bankruptcy Attorney
If you have been impacted by the COVID-19 pandemic and are planning to file or in the midst of a bankruptcy proceeding, it is in your best interest to consult with an experienced bankruptcy attorney to help you learn your legal rights and options, especially with respect to Chapter 7 bankruptcy.
For more information or to schedule a complimentary consultation with Central Valley bankruptcy attorney Gurjit Srai, please call (209) 395-0761 or (559) 449-1447, or complete our online form.