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What happens during a Chapter 7 bankruptcy filing?

Making the choice to file for bankruptcy is not easy. If you decided this is the right step for you, it is probably because you have debts you can no longer manage on your own and are dealing with unpleasant things such as constant phone calls from debt collectors. Like many who move forward with this process, you plan to seek Chapter 7 bankruptcy protection.

Chapter 7 is a popular choice for New Hampshire individuals who have a significant amount of debt. This is because it only takes a few months to complete, and it can discharge certain types of unsecured debt, such as medical bills and credit card debt. Before you move forward with this process, you may find it beneficial to learn about the eligibility requirements of Chapter 7, the benefits of bankruptcy and what to expect from the process

What happens first?

Like many legal processes, filing for bankruptcy begins with completing paperwork. You will file your petition with the appropriate court, but you must include other important information as well. Required documentation includes a list of your assets and liabilities, income and expenses, financial obligations and contracts. This will help the court determine if you are eligible. After this, certain financial information will be placed with the bankruptcy trustee. 

Protection from creditors 

When your petition for bankruptcy gets approval, it will enact the automatic stay. This means that creditors will no longer be able to pursue payment from you. Bankruptcy offers protection from all collections efforts, including wage garnishment, foreclosure processes and even phone calls from debt collectors. This offers you the opportunity to follow the terms of the bankruptcy plan and restore your financial standing without dealing with collection matters. 

A meeting of your creditors

Several weeks after filing, your creditors will meet with the bankruptcy trustee to discuss your case. You must attend this meeting. They may ask questions about your finances and property. It is important to be cooperative with the bankruptcy trustee and provide any information requested.

Your financial future 

Bankruptcy is probably not your ideal choice, but it could offer you the best opportunity to secure a better and brighter financial future. Not everyone who wants to file for Chapter 7 will be eligible, but there could be other options that will work better for your situation. An assessment of your case can help you understand what you need to do to move forward with this process and how you can prepare.

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