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February 04, 2011
Chapter 7 is one of the six bankruptcy chapters encompassed by the U.S. Bankruptcy Code. This chapter is available to individuals, business partnerships, corporations, and other business entities who qualify for protection through the court.
Obtaining debt relief through Chapter 7 is not as simple as it used to be. Reason being, new bankruptcy laws that took effect in 2005 require debtors to repay a portion of their debts by making restitution to the court using Chapter 13 payments.
January 21, 2011
Chapter 7 is often referred to as liquidation bankruptcy because debtors are required to liquidate assets to pay outstanding debts. In the past, this personal bankruptcy chapter was the preferred choice because it wipes out debts and allows debtors to have a fresh start.
Today, Chapter 7 is only offered to debtors who do not qualify for Chapter 13 under regulations set forth in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. These new bankruptcy laws were enacted to reduce frivolous bankruptcy filings to eradicate credit card debt and personal debts caused by reckless spending.
August 21, 2008
Personal bankruptcy includes Chapter 7 and Chapter 13 of the United States Bankruptcy Code. Chapter 7 eliminates outstanding creditor debts through liquidation of assets, while Chapter 13 allows individuals to retain assets through restructure of payment to creditors.
Many Americans file personal bankruptcy when they are no longer able to keep pace with their financial responsibilities. Oftentimes, people are thrown into bankruptcy due to unemployment, medical issues, divorce or death of a spouse. Other times, bankruptcy is brought on due to reckless and irresponsible spending habits.