Knoxville Chapter 7 Bankruptcy Attorney
What is Chapter 7 Bankruptcy?
More and more people are facing devastating debt. Paying off this debt can seem impossible, even to people who have gone through debt reorganization and an extended repayment plan.
Overwhelming medical bills, personal loans, and credit card charges, for instance, plague many people. If you find yourself in this situation or in one similar to it, Chapter 7 bankruptcy, which is also referred to as “Fresh Start” or “Straight” bankruptcy, may be the best option for you. Chapter 7 bankruptcy can eliminate most or all of your debts; at the same time, it will allow you to keep certain assets that do not exceed exemptions.
Chapter 7 bankruptcy also allows you to walk away from a mortgage you can no longer afford, and it can stop a foreclosure in order to give you enough time to find a new place to live. At The Sexton Law Firm, we have experienced and knowledgeable lawyers who can steer you through Chapter 7 bankruptcy. Call us today at (865) 691-7900 to discuss your specific circumstances with one of our bankruptcy attorneys.
Chapter 7 bankruptcy is different from Chapter 13 bankruptcy because there is no reorganization of debt and no payment plan. If you are behind on your mortgage, for instance, you will most likely have to give up your home under Chapter 13.
Chapter 7 bankruptcy is referred to as “liquidation” and involves selling a person’s nonexempt property; the proceeds of the sale are then distributed to the person’s creditors. This typically results in a person being discharged from paying most of what debt remains. Call us for a free consultation to determine which path is best for you.
Filing For Chapter 7 Bankruptcy
Before you file for Chapter 7 bankruptcy, one of our bankruptcy attorneys will evaluate your assets, debts, and income to ensure that doing so is in your best interest. Once determining that Chapter 7 is right for you, we will move forward with the means test. The Bankruptcy Code requires that every person that files for Chapter 7 must qualify by proving that his or her income is above the state median. Additionally, you must undergo credit counseling with an approved agency.
Filing for Chapter 7 bankruptcy, or debt liquidation, can stop a pending foreclosure for anywhere from a few weeks to a few months. Once you have filed for Chapter 7 bankruptcy, your mortgage company will file a motion for relief from stay with the bankruptcy court. This motion will take about three or four weeks to complete and will lift bankruptcy protection from your mortgage in order for the mortgage company to restart the foreclosure process.
In most instances, this will give you another four to eight weeks to move out of your home and find a new place to live. In other words, while Chapter 7 bankruptcy cannot solve your current mortgage delinquency, it can give you time and opportunity to move forward on your terms.
After we have successfully met all of the requirements for Chapter 7 bankruptcy, we can move forward with your bankruptcy. During this process, a trustee will gather and sell your nonexempt assets. We will work with you to decided which exemptions to claim for your specific situation. Types of exempt assets we can help you keep in whole or at least part include, but are not limited to:
- Personal effects and clothes
- Household goods such as furniture and appliances
- Tools of the trade
- Homestead equity
- Vehicle equity
- Retirement plans
- Insurance polices
- Workers compensation
- Personal injury claim income
Once the sale of your nonexempt assets is complete, the proceeds will go toward paying your creditors. Any remaining debts that are eligible are then discharged; there are some debts that cannot be discharged, however. These include alimony and child support and certain taxes, educational loans, personal injury debts, and criminal restitution debts.
Filing for Chapter 7 bankruptcy is a complicated process. In order to navigate the process successfully, it is important to have the experience and skills of our bankruptcy lawyers in your corner. The Sexton Law Firm will maximize the assets you keep and minimize those that are liquidated.
For a private consultation to discuss your bankruptcy options, call the attorneys at The Sexton Law Firm at (865) 691-7900 or fill out our online Quick Contact form.