Filing a Chapter 7 Bankruptcy in Boston, Massachusetts

If you have high credit card debt, you have not paid your mortgage, or you have expensive medical bills, you may be in a financial crisis. Have you considered filing for bankruptcy?

Although filing for bankruptcy is a serious financial decision, it may allow you to discharge most of your unsecure debt or create a debt repayment plan to repay your creditors. Filing for bankruptcy will also stop certain lawsuits, foreclosures, utility shut-offs, evictions, repossessions, garnishments, attachments, and debt collection harassment. That means, until the bankruptcy is discharged, all creditors will have to go through a trustee for debt repayment. 

Chapter 7 Bankruptcy, commonly called liquidation of your assets, is the simplest and quickest form of bankruptcy.  It is available to individuals, married couples, corporations, and partnerships.  A court-appointed trustee will gather and sell your non-exempt property and use the proceeds from the sale to pay your creditors.

Most Chapter 7 cases are “no-asset” cases and the debtor will not have any non-exempt property for the trustee to sell. With a Chapter 7 discharge, if you do not have any non-exempt assets to sell, the creditors will not receive anything for their debt collections. You will also no longer owe the debts, and the creditors will have no more legal recourse.

Chapter 7 Bankruptcy, however, does not discharge all debts. Debts not discharged under Chapter 7 Bankruptcy include: alimony, child support, back taxes, most student loans, large recent purchases of more than $550 for luxury items, fines and penalties by government agencies, fraudulent debts, and cash advances of $825 within 70 days of filing for bankruptcy.  In addition, if a creditor has a lien on any type personal or real property, filing a bankruptcy will have no effect, and the creditor can still legally claim the property to satisfy the lien.

Many states also have homestead laws which prevents a creditor from foreclosing on certain types of property. If you have assets that are non-exempt, a trustee will seize the property and liquidate the assets to pay off your creditors. If there is any money left over after the liquidation of your assets, you will be the beneficiary of the proceeds. You can keep exempt property or property bought back from the trustee. 

Federal or state exemptions may be used in a Massachusetts bankruptcy. Exempt property includes: homestead property, personal property, tools of your trade, insurance and awards benefits, public benefits, pensions, wages, and miscellaneous exemptions. 

Not everyone can file for Chapter 7 Bankruptcy. If a debtor’s income is below the median income for families in the state, based on Census Bureau statistics, the debtor will be eligible. Debtors whose income is higher than the state’s median income will not be able to file for Chapter 7 Bankruptcy unless their disposable income is within certain limits. 

Filing bankruptcy can be complicated. Contact a bankruptcy lawyer if you have questions or if you need to know if bankruptcy is right for you. If you need relief from the stress of debt and you live in or around the metropolitan area of Boston, Massachusetts, contact us at www.betterbankruptcy.com. We will help you find a bankruptcy attorney in your area who will answer your bankruptcy questions.

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