Chapter 7 Bankruptcy is a fresh start, clean slate bankruptcy. It is easily the most common form of bankruptcy and generally what people think about when they hear the word “bankruptcy”. Chapter 7 bankruptcy may allow you to discharge debts such as credit cards, collection accounts, medical bills, signature loans, repossession deficiencies, foreclosure deficiencies, old tax debt, and overpayment of social security disability or unemployment compensation.
A typical Chapter 7 Bankruptcy generally proceeds as follows:
- Call for a free phone or in-office consultation with The Law Offices of Dax J. Miller to determine if Chapter 7 Bankruptcy is best for you.
- Come to our office where we will draft your bankruptcy petition right in front of you. There are no tedious forms or questionnaires for you to fill out. You are paying for an attorney’s attention and that is what you get.
- We then file your case which creates a federal injunction against the collection of most types of debts. This usually stops all debt collection phone calls, collection letters, negative reporting to your credit and most lawsuits (exceptions apply).
- One month later, you have a hearing that you attend with us. There is no judge and no jury. It is not even in a courtroom and most hearings last less than five minutes.
- Approximately two months later, you will receive your discharge and you are done.
- Generally speaking, most clients start receiving solicitations from banks to start new credit cards or even finance vehicles immediately after receiving a discharge. We warn clients to view these offers with caution because you obviously do not want to end right back up in debt.
- If you are in the market for a new home and do not have a 20% down payment, you actually only have to wait two years from the date of discharge to be eligible for a FHA home loan through the federal government. The FHA program requires you only put down 3.5%!
- A major misconception people have about bankruptcy is that they have to wait seven or eight or even 20 years — we hear all sorts of numbers thrown around — before you can even use credit again. That is completely false. The truth is that you can start rebuilding right away. However, the debts that you discharge in your bankruptcy will stay on your credit report as “0.00 balance” or “Discharged in Chapter 7 Bankruptcy”.
If you have questions about your Chapter 7 Bankruptcy options, Contact Us today for a free consultation!