At Phoenix Fresh Start Bankruptcy Attorneys, we hear questions about Chapter 7 bankruptcy every day. This is the second in a series of post where we will be addressing some common Chapter 7 bankruptcy concerns.
I am in a Bad Way but I Have Already Filed. Can I file again?
Provided that you have already filed Chapter 7 Bankruptcy and actually obtained a discharge, Chapter 7 again if eight years have passed since the date you filed your last case.
If you aren’t eligible for Chapter 7, you can still file a Chapter 13 after receiving a Chapter 7 discharge, but you won’t receive an actual discharge of your debts unless four years have passed since the date you filed the Chapter 7.
Even if the four years haven’t passed, you can still file Chapter 13 and get many of its benefits, including stopping foreclosures and garnishments and keeping your creditors away from you. Many of our clients “park” in this kind of Chapter 13 until they are eligible again to get a discharge in a Chapter 7 or Chapter 13 case. Once they are eligible, they dismiss their non-eligible case and file a discharge-eligible one.
Will a Chapter 7 Get Rid of All My Debts?
Chapter 7 does not eliminate all debts. Chapter 7 is a great tool for discharging unsecured debts like medical bills, repos, pay day loans and credit card debt. Other debts, however, like student some kinds of taxes, student loans are rarely eliminated. Likewise, debts stemming from criminal acts like driving under the influence of intoxicants generally will not be eliminated in Chapter 7.
Debts incurred through false pretenses or fraud may not be eliminated in Chapter 7. Chapter 13 can, however, discharge many debts that Chapter 7 will not. You should meet with an attorney at Phoenix Fresh Start Bankruptcy Attorneys, LLP to review the nature of your debts and which bankruptcy chapter is the best tool for you.
Is the Chapter 7 Trustee Going to Sell Off My “Non-Exempt” Property?
The Chapter 7 Trustee is only interested in a property that the Trustee can liquidate to distribute proceeds to pay unsecured creditors. If you own a vehicle worth $5,000, and you still owe $5,000 to the lender, the Trustee won’t touch the vehicle because he would have to pay all of the sale proceeds to the auto lender and there would be nothing to hand to the unsecured creditors.
The Arizona legislature has created certain “exemptions” to protect your real and personal property. Exemptions are a dollar value in certain property that is protected from all of your creditors, including a bankruptcy Trustee. If the value of your property is within the exemption limits, the Trustee will not take and sell the “exempt” property.
One of the services that Phoenix Fresh Start Bankruptcy Attorneys, LLP can provide to you is a review of your assets and the exemptions available to protect them. Phoenix Fresh Start Bankruptcy Attorneys, LLP can also help you with exemption planning to help you preserve as much of your property as possible during the bankruptcy process.