What is a Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is often known as a liquidation bankruptcy because the potential exists for assets to be liquidated in order to satisfy creditor obligations. While this is a common name for a ch 7 bankruptcy, the name is basically a misnomer in most cases. The chance exists as a reality for people who are not filing their case properly that they could have assets liquidated. But if a debtor files under the guidance, legal advice and representation by a Cedar Hill bankruptcy attorney then they could typically rest assured that their assets will be exempted and protected while filing chapter 7 bankruptcy. The reason for this is that up to 99% of bankruptcy cases involve debtors who have assets that are largely exempt from liquidation.
On the other hand, if you have multiple homes, luxury automobiles, an airplane, boats, and expensive jewelry and toys, then these assets are the type of assets that would be nonexempt and subject to liquidation. Additionally, if a person does not properly exempt a vehicle by making the case that the vehicle is exempt and necessary to the running of the household, then they could lose this vehicle to a technicality. This is the reason that hiring a qualified attorney is important.
Ch 7 Bankruptcy Stay on My Credit For 7-10 Years, Right?
The answer to this question is yes, but the premise of the question is often highly misunderstood. The reason for this is that although a bankruptcy stays on credit for 7-10 years in most cases, the actual bankruptcy itself affects credit for a far shorter period of time in many cases. For example, when a person obtains debt, they are judged by prospective lenders according to their ability and willingness to pay the debt. And the best way for a lender to determine if a prospective borrower can repay and will repay the loan is to check their most recent two years’ worth of payments. In order to make the best assessment about the ability and willingness of a debtor to repay a loan, the on time payments and other elements like income and debt to income are used in making this decision. More recent events on credit have much more impact than older events. Hence, as the bankruptcy becomes older, the impact on the credit report of a borrower goes down more and more.
Can I Have a Bank Account if I File Chapter 7?
Filing chapter 7 bankruptcy typically does not affect your ability to get a bank account. If you have lots of negative events with banks that are reported to Chex Systems, then you will likely have trouble getting a bank account regardless of whether you file a chapter 7 case or not. But the bankruptcy itself typically does not have a major income in the outcome of whether you are approved for a bank account.
I Filed Chapter 7 Bankruptcy Already, Can I File Again?
The answer to this question depends on how long it has been since you filed the previous bankruptcy. If you filed a chapter 7 bankruptcy 8 years and one day ago, then you will be eligible to obtain a bankruptcy discharge through chapter 7 bankruptcy again. But if you have filed ch. 7 bankruptcy within the last 8 years, then you will not be eligible to refile until the time is up for you to be allowed to file again.