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Chapter 7 Bankruptcy Attorney

Chapter 7 Bankruptcy Attorney 


What Is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is also known as "liquidation" bankruptcy. Chapter seven is designed to allow individuals and business to wipe out certain debts; hence, my web site name The law is actually embodied in Title 11 of the US Code.  Under that code section Chapter 7 is the chapter which explains the discharge of debts.  All of the steps for getting out of debt are embodied in the Laws of the United States of America.  The bankruptcy process involves liquidating the debtor's non-exempt assets to pay off creditors. However, this liquidation is very rare.  Most of my client lose nothing to the Chapter 7 Trustee.  After a hearing and complying with all of the court rules the court will issue a discharge of debt.  Any debts that are entitled to the chapter 7 discharge will be discharged.  Once the court enters the discharge those debts are blocked from ever being collected by a creditor.

How does Chapter 7 bankruptcy work?

Step One: 

Prepare all of your Bankruptcy documents.  Please click this link to see some of the OFFICIAL BANKRUPTCY DOCUMENTS that must be filed with the bankruptcy court in your jurisdiction.  If you are filing Bankruptcy in Tucson Arizona I can prepare all of your documents and help you file your Chapter 7 bankruptcy.

Step Two:

Under 11 U.S.C. Section 109(h) all individuals MUST complete a credit counseling and provide the court with a certificate.  Click here to see a sample CREDIT COUNSELING CERTIFICATE.  BEWARE!  This counseling must be completed prior to filing bankruptcy.  There is one additional course that must be done after filing. This certificate gets filed with the court when you file your case.

Step Three:

To file for Chapter 7 bankruptcy the debtor (or your attorney) must first file a petition with the bankruptcy court. The petition is almost like the Title Page of the case.  It is telling the court and the general public what you, as the debtor ,are doing;  i.e. Hi my name is Jon Doe and I am Petitioning (asking) the court for a bankruptcy discharge of my debts.   There are many other documents that must be filed when you file your case.  BEWARE!  If those documents are not filed timely your case can be dismissed.  Click here to see a sample Chapter 7 Petition.

Step Four:


The court will appoint a trustee to oversee part of the bankruptcy process.  The trustee can take your assets that are not exempt and pay certain debts.   Remember this is one of the reasons that you hire a knowledgeable attorney to help you keep your assets.  The trustee will review the debtor's financial information, including their assets, debts, and income.

Step Five:

The debtor must then attend a meeting with the trustee and their creditors (don't worry creditors hardly EVER show up). During the meeting, the trustee will ask the debtor questions about their financial situation. Creditors may also attend the meeting and ask questions.  This is referred to as the section 341 meeting of creditors.  If you have hired the right attorney you will be prepared for all of the questions that the trustee will ask you.  After the meeting the trustee will begin the process of liquidating the debtor's non-exempt assets. The proceeds from the liquidation are then used to pay off the debtor's creditors. 

Step Six:

The debtor must complete the Debtor Education required course.  Once the course is complete you will be eligible for your discharge so long as you have complied with all of the rules and requirements.

Step Seven:

The court will enter the discharge.  This usually happens within 5 to 6 months of the filing of the petition. 


These are the basic steps to file for Chapter 7 bankruptcy.  This synopsis is meant to give a roadmap to understand the process.  Issues will arise in most cases.  It is vital to get a free consultation from a Tucson bankruptcy attorney to protect your assets.  Call us today to schedule your free consultation.

What is Chapter 7?

Chapter 7 bankruptcy is a federal court proceeding where honest debtors are forgiven many of their outstanding obligations. It is called a liquidation proceeding because a trustee is appointed to ascertain which of the debtors assets are not protected and are subject to being sold by the Trustee’s Office for the repayment of creditors.

On the day that a Chapter 7 proceeding is filed with the court, all of the debtors assets become property of the Bankruptcy Estate. Assets that are Exempt are protected. Assets that are not protected may be taken by the Trustee and sold in order to allow a distribution of money out to the debtors creditors.

When the Chapter 7 is filed, a protection order called the Automatic Stay is immediately issued by the court. The Automatic Stay requires that your creditors cease all harassment, collection activities, garnishments, lawsuits, foreclosures, and repossessions. The Automatic Stay provides you with a powerful shield of protection that allows you and your family to resume your daily routine without having to worry about creditor intrusion, annoying phone calls, angry attitudes, and disruptive repossessions or foreclosures.
The Automatic Stay is the first step to obtaining your Fresh Start and regaining your peace of mind. It is very important that you speak with an experienced bankruptcy attorney before selling any assets or paying any debts that are not in the ordinary monthly course of your home or business. Once a Chapter 7 proceeding is filed and a trustee is appointed, there will be a date set for the debtor to appear at a hearing called the First Meeting of Creditors. It is important that you discuss in advance with your attorney what will happen at the hearing. In order to file a Chapter 7 case you must first assist our offices in the preparation of your filing paperwork. It is critical that this paperwork be complete and accurate. You will also need to speak with a credit counselor to obtain a Credit Counseling Certificate. No one can file a bankruptcy without a Credit Counseling Certificate issued by an authorized counselor.

In order to be eligible for Chapter 7 bankruptcy relief, your total household income, averaged over the 6 month period before your case is filed, must be less than the median income for a family or household of your size in the State of Arizona. If your gross income is higher than the median income for a family of your size, we must make a calculation (called the “Means Test”) which will determine whether you can afford to pay some of your unsecured creditors in a Chapter 13 bankruptcy over a period of 36-60 months. The outcome of this calculation will determine if you qualify to file a Chapter 7 proceeding. No one is eligible to file a Chapter 7 case when they have filed a previous Chapter 7 in the last 8 years, or if they have received a discharge in a Chapter 13 proceeding filed in the last 4 years that failed to pay unsecured creditors at least 70% of allowed claims.

In most cases the Court will enter a discharge order about 3 or 4 months after the meeting of creditors. This means that the Court orders your creditors to never attempt to collect the debt in the future. If they try to collect in the future, you should contact our offices immediately.

However, remember that not all debts are dischargeable. Debts that survive bankruptcy will have to be paid or the creditor may resume collection activities after the case is discharged.
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