As one of the most common bankruptcy filings, Chapter 7 allows for the liquidation of assets to help those struggling with debt to regain control of their finances once more. Unlike Chapter 11, which is a restructuring of the business or personal assets into a repayment plan, Chapter 7 discharges certain debts entirely and liquidates certain assets.
Businesses filing Chapter 7 must stop all operations immediately after the filing unless a trustee is appointed and chooses to continue operations. This trustee then generally liquidates and sells assets of the company to pay off creditors. Employees of the business are generally in vulnerable during this process, as they are not guaranteed to be kept their jobs.
Corporations filing for Chapter 7 do not have their debts discharged. Instead, their debts are simply dissolved by the end of the bankruptcy process.
Individuals filing for Chapter 7 can have certain debts discharged, while other certain debts are exempt by law and will not be discharged. The Chapter 7 filing will stay on their credit report for up to ten years and will have a negative impact; however, the individual will be able to begin rebuilding their credit almost immediately after filing. If, however, a Chapter 13 could allow the individual to repay their debt in a timely manner, the individual will most likely not be eligible to file for Chapter 7 bankruptcy.
Bankruptcy is an extremely important decision that deserves to be considered and contemplated from every angle. If your financial situation has caused you to consider seeking financial relief by filing for bankruptcy, you should not hesitate to contact Illinois Bankruptcy Lawyer Daniel S. Khwaja today to get your questions answered. Attorney Khwaja can help you take your financial life back with a Chapter 7 bankruptcy resolution.
There are many factors that may determine eligibility of a Chapter 7 filing. Illinois Bankruptcy Attorney Daniel S. Khwaja can give you a qualified overview of the process and assist you in your bankruptcy filing if you decide it is the best option for you.