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Chapter 7

Chapter 7 is the most common type of bankruptcy and often referred to as a straight bankruptcy. Under Chapter 7, you can quickly eliminate most of your unsecured debts, such as personal loans and credit cards.

Once you file for Chapter 7 bankruptcy, a Chapter 7 trustee is being immediately appointed to administer the bankruptcy estate, which includes all assets that are owned or may be claimed by you. The trustee will conduct a chapter 7 meeting of creditors approximately 40 days after the bankruptcy filing. During the meeting, the trustee asks you questions under oath about your bankruptcy documents and your financial affairs. In most cases the Chapter 7 bankruptcy consumer cases will end with a discharge order. The discharge will relieve you from being personally liable to most of your debts.

A person who files for chapter 7 bankruptcy may be required to surrender all of his non-exempt properties to the Chapter 7 Trustee. The Chapter 7 Trustee may liquidate these non-exempt assets and pay the proceeds to the unsecured creditors.

Because California laws concerning exemptions are generous compare to other states, most people who file for Chapter 7 bankruptcy in California, get to keep all of their assets.   However, during the years of my practice I have seen many cases that ended with liquidation of assets. For example, due to the rise in real estate prices in the San Francisco Bay Area in the past few years, most real estate owners have non-exempt equity in their real estate and thus they should probably look into filing a Chapter 13 bankruptcy rather than Chapter 7 bankruptcy.

Filing for bankruptcy is a serious matter. It is not a do-it-yourself project.  It is very important to get a proper legal advice and competent representation from a qualified bankruptcy attorney. .I will be happy to provide a free initial consultation in order to determine if Chapter 7 bankruptcy is right for you.  

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