Chapter 7 Bankruptcy

What is Chapter 7 Bankruptcy in Wilmington, NC?

In a Chapter 7 bankruptcy filing, a debtor is allowed to claim as exempt certain property free from the claims of their creditors. Any property the debtor is unable to protect is then sold (“liquidated”) by the Chapter 7 trustee to repay a portion of the debtor’s obligations.

Frequently, no property is liquidated in a Chapter 7, as most debtors are able to protect all of their property free from the Chapter 7 trustee. If the trustee is unable to sell any of the debtor’s property, the case will stay open around four-five months, with the debtor’s discharge (the signed order from the Bankruptcy Judge legally eliminating most of their debts) being entered at the time the case closes.

Is Chapter 7 bankruptcy right for me

Deciding to file for Chapter 7 bankruptcy is a significant decision that depends on your specific financial situation. If you’re facing insurmountable debt and looking for a fresh start, Chapter 7 may offer the relief you need. However, it’s important to weigh the benefits against the potential consequences, such as the impact on your credit and the loss of property.

For personalized advice and to explore all your options, consider consulting with a bankruptcy attorney in Eastern North Carolina. They can provide you with guidance tailored to your unique circumstances.

Who Can File for Chapter 7 Bankruptcy in Eastern North Carolina?

To qualify for relief under Chapter 7 of the Bankruptcy Code, the debtor may be an individual, a partnership, or a corporation or other business entity. 11 U.S.C. §§ 101(41), 109(b).

Businesses and Individuals: Chapter 7 Bankruptcy provides a pathway for both individuals and businesses overwhelmed by debt to find relief. Here’s how it applies to each:

For Individuals: Individuals seeking relief from insurmountable debt can file for Chapter 7 to liquidate non-exempt assets in order to pay off creditors. This process is designed for those who find themselves unable to maintain regular payments on their debt obligations.

For Businesses: Businesses, ranging from sole proprietorships to large corporations, can also seek refuge under Chapter 7 bankruptcy for a clean closure. Filing allows businesses to liquidate their assets through a trustee to pay off debts. This option typically leads to the cessation or winding down of business operations, offering a structured method to close business activities and address debts.

what's the process for Chapter 7 Bankruptcy in NC?

Consultation with a Bankruptcy Attorney: It’s crucial to start by consulting with a knowledgeable bankruptcy attorney to discuss your financial situation and determine if Chapter 7 is the best path for you.
Filing the Petition: Your attorney will help prepare and file a bankruptcy petition along with schedules listing your assets, debts, income, and expenses.
Automatic Stay: Once filed, an automatic stay immediately stops most creditors from pursuing debt collection actions against you.
Meeting of Creditors: Approximately a month after filing, you will attend a meeting of creditors, where the trustee and any creditors can ask you questions about your bankruptcy filing and finances.
Liquidation: If you have non-exempt assets, the trustee will sell these to pay off your creditors as much as possible.
Discharge: Upon completion of the bankruptcy process, most of your remaining unsecured debts will be discharged.

Contact Cape Fear Debt Relief today and speak with an experienced attorney to find out if you are able to protect your property from your creditors in a Chapter 7

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