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Bankruptcy Chapter 7
October 5 2016

Understanding Chapter 7 Bankruptcy

Kurt Reinheimer Bankruptcy

A Chapter 7 bankruptcy is termed a “liquidation” type of bankruptcy. This type of filing is generally used by individuals or consumers although a business may also file a Chapter 7 if it no longer intends to continue operating as a business.

Exemptions

In a Chapter 7 bankruptcy the person filing is required to list all of their debts and all of their assets. Different types of real property (house, land, etc.) and personal property (furniture, jewelry, etc.) have different amounts of value that can be protected. These are referred to as “exemptions” under the United States Bankruptcy Code.

During your initial meeting with counsel, all categories of property will be closely examined and valuations will be assigned to the respective item(s) of property. In most instances, the individual filer(s) will exit bankruptcy with all of the assets they entered bankruptcy with.

Chapter 7 bankruptcy is for those who do not have the ability to pay creditors back. As such, in most instances the individual will have more in the way of monthly expenses then they have in monthly take home income. Many people are able to file for Chapter 7 relief even while owning a home or multiple properties.

Duration

Chapter 7 bankruptcy is a rather quick process taking approximately four (4) months to complete. Once your petition is filed, you will be scheduled for a 341(A) hearing (also referred to as a 341A Meeting of Creditors) which will take place approximately one (1) month later.

In New Jersey, hearings will take place in Trenton, Camden or Newark depending on where the party lives in New Jersey. Most hearings will last approximately five (5) to ten (10) minutes and will take place before a panel trustee.

Most hearings will consist of twenty (20) to thirty (30) questions. This hearing will not take place before a judge or in a courtroom.

Photo ID and proof of one’s Social Security number are required by the party filing and both must be presented at the time of the hearing. Your Attorney is seated directly to your side throughout the hearing. Be sure your attorney personally attends all such hearings and doesn’t hire someone from outside his/her office to cover them. I have seen a great deal of otherwise avoidable problems occur from this arrangement.

Discharge of Debtor Notice

Customarily, one will receive their “Discharge of Debtor” notice approximately sixty-five (65) to seventy-five (75) days following their hearing. This document means that the case has been completed and the person filing is no longer responsible to pay for the debts they were seeking to walk away from.


At the firm of Reinheimer & Reinheimer all of our bankruptcy intake consultations are completely free and are conducted by an attorney. Customarily, the initial intake will take approximately ninety (90) minutes to complete and can be done in person, over the phone or via Skype.

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