My wife and I made the decision to open a residential cleaning business. We needed enough money to get the equipment, do a bit of advertising and get the licensing and insurance to protect ourselves and our customers. For about two years, things went very well, but then, things took a terrible spin for the worst after we hired a few employees to help us with the workload. Since then, we have gone bankrupt and have gone back to working full time jobs. If you are struggling with your business and considering bankruptcy, this blog can give you some answers to the many questions that you have.
A lot of people find themselves in debt to a point where they seek help, and one type of help you can seek for debt issues is bankruptcy. If you decide to pursue Chapter 7 bankruptcy, you should understand the following three things before you file.
Not Everyone Is Eligible to Use this Chapter
To use Chapter 7 bankruptcy to find relief from bills you owe, you will first need to find out if you are eligible. Not everyone is eligible to use this branch, but you will be able to if your income is less than the average in the state where you live. The average income in your state is called the median income, and a lawyer will add up your income to see where it falls compared to this amount. If you qualify for Chapter 7, you could find a lot of relief if you file under this branch; however, there are several other things to know before you file.
There Is a Chance You Could Lose Assets
One of the risks you take with Chapter 7 is the potential for the trustee to seize assets you currently own. This includes cash in the bank, a tax return you will receive in the upcoming year, vehicles, and any other types of assets that might have a lot of equity in them. Having to surrender your assets is the trade-off you receive for the debt forgiveness Chapter 7 offers to those who file. Before you file, your lawyer can help you determine what assets could pose risks for being seized by the trustee, and you should factor this in as you decide whether to file or not.
It Only Offers Forgiveness for Certain Debts
The other thing you must understand before filing is the debts that Chapter 7 forgives and the types that do not qualify for forgiveness. In most cases, debts considered unsecured will qualify for forgiveness, and this will include money owed to credit card companies. Debts that will not be included in this include child support, alimony, and student loans. Your lawyer can distinguish which debts would not qualify for debt forgiveness, and you should consider this as you decide if you should file.
Using Chapter 7 as a way to become debt-free is a good option if you qualify and have the right types of debts. If you would like to find out if you qualify and if this branch could help you, contact a Chapter 7 bankruptcy filing services provider today.
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