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What to Know Before Filing for Chapter 7 Bankruptcy

Posted by Rory Vohwinkel | Aug 24, 2018 | 0 Comments

Children may be introduced to the concept of bankruptcy in old-fashioned board games such as Monopoly. They run out of money after mortgaging all their properties and throw up their hands to declare they are bankrupt. In the adult world, bankruptcy is not child's play. It's a serious decision that needs to be made carefully and pursued only as a last resort with the help of an experienced bankruptcy Las Vegas attorney. Here are some things to know before making this decision.

Credit Report Consequences

Although Chapter 7 Bankruptcy was a federal law designed to help desperate individuals discharge debts they can no longer pay, it has significant consequences on your credit report. If you decide to file Chapter 7, this will appear on your credit report for 10 years, making it difficult or impossible to secure future lines of credit.

Emotional Consequences

When you reach the point of considering bankruptcy as an option, it may seem like the answer to a very difficult financial situation. Although this may be true, you need to also accept the fact that the filing process can be difficult and involve investigation into all corners of your financial life. This process can be emotionally difficult and stressful.

Debts Discharged 

If you find yourself in a financial crisis where it becomes impossible to catch up on what you owe your creditors, filing Chapter 7 bankruptcy may be an option for you. Here are debts that can be successfully discharged in Chapter 7:

* lawsuit payments
* lease and contract payments
* personal loans
* credit card debt
* medical and dental bills
* car accidents payments
* promissory notes

Remaining Debt 

Although you can get significant debt relief from Chapter 7 filing, some of your debt may still need to be repaid after you file. In this case, filing only delays payment so you can get your financial house in order and then pay back the following obligations:

* all marital debts from divorce or settlement agreements, excluding support payments
* court fees
* payments for any nondischargeable tax debt
* homeowners, condo or co-op housing fees
* debts incurred from taking retirement plan loans
* any other nondischargeable debt from a previous bankruptcy filing

Protection Guaranteed 

When you file Chapter 7 bankruptcy protection, all your creditors are automatically subject to a restraining order. This means that creditors can no longer call you, send you threatening letters, harass you, sue you or do anything else to collect the money owed to them.

After the paperwork is complete and if your bankruptcy filing is successful, this restraining order becomes permanent. Once your debt is discharged, your creditors cannot contact you again and your debt is permanently erased.

The bankruptcy filing process can be long and complicated. To reduce your stress and help you navigate a difficult process, be sure to contact a
Chapter 7 bankruptcy attorney Las Vegas to help.

About the Author

Rory Vohwinkel

Rory Vohwinkel began his legal career at one of Nevada's oldest and largest law firms, representing clients in commercial litigation and business transactions. Rory went on to serve as the sole in-house attorney for a national real estate investment and property management company. In 2009, Rory...

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