What is Chapter 7 Bankruptcy?

Chapter 7 refers to the chapter of the federal Bankruptcy Code, the body of law that deals with bankruptcy in the United States. Chapter 7 bankruptcy is sometimes called “liquidation” bankruptcy and is a common form of bankruptcy that cancels your debts.

There are clear criteria that determine who can file for Chapter 7 bankruptcy, and who will be forced to file under Chapter 13. It is important to note that disabled veterans who incurred their debts during active duty, and people who incurred their debts primarily from the operation of a business, are clearly eligible to file for Chapter 7 bankruptcy.

Everyone else must meet the following income requirements:
If your current monthly income is less than or equal to the median income for a family of your size in your state, you can file or Chapter 7. Current monthly income is your average income over the last six months before you file.

If your income is more than the median, then you must pass a “means test” or you cannot file for Chapter 7. The means test determines whether you have enough disposable income, after subtracting certain allowed expenses and required debt payments, to repay at least a portion of your unsecured debts over a five-year repayment period.

You cannot file if you have previously received a bankruptcy discharge. Read the entire article by visting the Schwilm Law Firm’s website or click here.

For more information on Charlortte chapter 7 bankruptcy, Charlotte chapter 13 bankruptcy and other bankruptcy facts contact the bankruptcy attorneys in Charlotte, NC.

By: Lee Schwilm (Bankruptcy lawyer in Charlotte NC)

You cannot file if you have previously received a bankruptcy discharge. Read the entire article by visting

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