In a Chapter 7 bankruptcy, a trustee examines all of your property and determines if you have any property that he/she can sell (i.e., liquidate) to pay your debts. Most individuals and families who file for Chapter 7 bankruptcy keep all of the property. Most do not have any assets to pay their debts when filing a Chapter 7 bankruptcy.

THE TRUSTEE

After filing your bankruptcy case, a trustee, who is appointed by the U.S. bankruptcy court, determines if you have non-exempt property and uses the proceeds from the sale to pay your creditors. At the time that you file your petition for bankruptcy, you declare whether your case is "asset" or "no-asset" and the burden is on the trustee to change the designation.

341 HEARINGS

The trustee holds a "first meeting of creditors” 20 to 40 days after your bankruptcy petition is filed. The first meeting of creditors," called a "341" meeting. You must be present. The trustee will ask questions under oath about your property and debts. Creditors can also question you, but seldom appear at the 341 meeting. The Trustee will determine if you have any property to sell (i.e., non-exempt property) after the 341 Meeting.

DISCHARGE UNDER CHAPTER 7 BANKRUPTCY

A few months after the 341 meeting, the U.S. bankruptcy court will hold a discharge hearing. A debtor’s unsecured debt (debt that is not secured by property), is discharged. If you want to keep your secured debt, such as a car loan or a mortgage, you will pay the creditor for the replacement value of the property (redemption), or agree to keep the property and pay the debt (reaffirmation). If you want to return the car or home to the creditor, you will surrender to the car finance or mortgage company and the debt is discharged by the bankruptcy court.

DEBTS THAT ARE DISCHARGED UNDER CHAPTER 7

In Chapter 7, examples of the types of debts that can be discharged are:

• Credit cards
• Medical bills
• Personal loans
• Electric, gas and telephone bills
• Civil court judgments (unless based on fraud or personal injury judgments)
• Past due rent(s)
• Collection agency accounts
• Repossession and mortgage deficiency judgments

DEBTS THAT ARE NOT DISCHARGED UNDER CHAPTER 7

Certain debts can't be discharged in bankruptcy. In a Chapter 7 case, the most common types of debts that can't be discharged are:

• Recent federal state and local taxes
• Student loans
• Spousal maintenance (alimony) and child support
• Debts obtained through fraud
• Debts for fines, restitution or penalties to federal, state or local government
• Debts for judgments in wrongful death or personal injury lawsuits
• Debts not listed in your bankruptcy

We are Chicago bankruptcy lawyers who specialize in consumer Chapter 7 bankruptcy. We are Chicago Chapter 7 lawyers, who charge a flat fee for our Chapter 7 bankruptcy cases-3 payments of $400 to file your Chapter 7 bankruptcy. As Chicago bankruptcy attorneys, Thomas Law Group, P.C. is here for you to assist you with your questions regarding Chapter 7 bankruptcy. Call 866-848-9183 or contact us online to schedule a free bankruptcy consultation. We serve clients in the entire Chicagoland area.