Chapter 7 is a federal legal proceeding in which a person who qualifies can discharge (not pay) most debts. It is what people normally refer to as “regular” or “straight” bankruptcy.
In exchange for the discharge of debts, certain assets may be liquidated to pay creditors. Although this sounds frightening, there are exemption laws which allow a debtor to retain most of their assets. Exemption laws vary greatly from state to state. In Oklahoma, most debtors get to keep their home, their vehicle, pension accounts, and all their normal household goods.
In order to obtain a discharge, a person (called the “debtor”) must file a “Voluntary Petition” in bankruptcy court. This usually must be done in the federal district where the debtor has resided for at least 91-180 days prior to filing the case. In addition, the debtor is required to file schedules (lists) detailing all of their assets, debts, income and expenses. They must also file a “Statement of Affairs” disclosing their financial affairs for the preceding two years.
All debtors are required to appear at a hearing called the Meeting of Creditors (or 341 hearing) which is set about 30-45 days after the case is filed.
Finally, debtors must file a certificate verifying the completion of a mandatory Financial Management course.
Contact or call (405) 840-6363 Oklahoma city office, (580) 353-4353 Lawton office for a free consultation!