Category Archives: Chapter 7 Bankruptcy

Understanding the Basics of a Chapter 7 Bankruptcy

English: Sketch of Richard Mentor Johnson free...

When you fail to understand basic law. (Photo credit: Wikipedia)

Bankruptcy law can be very complicated at times for a layman not familiar with legal jargon and terms. I have been writing a series about the basics in bankruptcy and this article deals with understanding the basics of a chapter 7 bankruptcy. Continue reading

How the Term Liquidation is Used in the Bankruptcy Process


The term liquidation is used in a general sense as a noun to describe various actions by agreement or litigation to determine the precise amount of indebtedness, damages, or accounts held by a person or entity. This term when used in a general sense implies the actions of a person or entity to make clear, do away with, or convert any type of asset or personal property into cash. How is the term liquidation specifically used in the bankruptcy process? Continue reading

Basics on the Chapter 7 Bankruptcy Process


There is always a lot of questions asked about the chapter 7 bankruptcy process, especially from new filers. Since bankruptcy law can become very complicated, this article is an attempt to deal with the simplest basics on the chapter 7 bankruptcy process. Continue reading

What Happens if You are Slightly Over the Means test?


The means test was devised by Congress in the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act to help protect creditors from abuse by debtors whom formerly had filed bankruptcies in a serial fashion. The number of times an individual can file within a certain time frame was introduced into the law to help alleviate such practices. In order to qualify to file a chapter 7 bankruptcy, a filer has to be able to pass the means test. What happens if you are slightly over the means test? Continue reading

California Debtor Facing Choice of Filing for Bankruptcy

One California debtor recently blogged his bankruptcy story over a bankruptcy website. The debtor has fallen on hard times due to a cocaine addiction, but rehab has given him a fresh new start. He lost his job and now makes 1/3 of his former salary. He owes unsecured creditors $90,000 and the IRS $35,000 in back taxes. His assets include a home with about $100,000 to $150,000 equity. He is being totally overwhelmed with collector calls, can only pay for food and mortgage payments, and wants to know what to do. Continue reading

Divorce, Credit Card Debt, and a Chapter 7 Bankruptcy

When my sister divorced, she settled for a lot of her former spouse’s credit card debt in the divorce decree. Now having too much debt for her single salary to ever completely pay off the principal with interest, she had to file for bankruptcy protection. In her case, she filed a chapter 13 bankruptcy to satisfy the divorce decree in paying the debts and because she had a certain amount of non-exempt assets she needed to protect. What about those of you who inherit credit card debt from a divorce and qualify for filing a chapter 7 bankruptcy? Continue reading

Stay and Pay After Filing Bankruptcy

Can you stay and pay for your home after filing bankruptcy, or do you have to surrender or reaffirm your home? This question is asked by a lot of bankruptcy filers in connection with whether or not they intend on keeping their principle home. Technically, if your bank is willing, there is no reason you cannot stay and pay after filing for bankruptcy protection. Continue reading

Better Understanding the Automatic Stay in Maine Bankruptcy Law

English: Part of Title 11 of the United States...

English: Part of Title 11 of the United States Code (the Bankruptcy Code) on a shelf at a law library in San Francisco. (Photo credit: Wikipedia)

If you are filing a Chapter 7 under Maine bankruptcy law, how the courts view and enforce the automatic stay becomes more important because of the limitations on your personal exemptions. The automatic stay of bankruptcy is mostly the same regardless of which state you have to file bankruptcy, but all bankruptcy courts have a certain amount of leeway to interpret and enforce the bankruptcy laws to fit each case. Continue reading

When a Second Lien Holder Writes Off a Discharged Debt

Seal of the United States Internal Revenue Ser...

Seal of the United States Internal Revenue Service. The design is the same as the Treasury seal with an IRS inscription. (Photo credit: Wikipedia)

What happens to a second lien when the second lien holder writes off a discharged debt from filing a Chapter 7 bankruptcy? Continue reading