Chapter 7 Bankruptcy
One of the most common types of bankruptcy for consumers happens to be Chapter 7 bankruptcy. It is a type of liquidation bankruptcy which essentially means it liquidates, or wipes out, most of your general unsecured debts, most of which being credit cards and medical bills. Furthermore, in liquidating your accumulated debts it eliminates the need to pay back those debts through a chosen repayment plan. With this being said, in order to qualify for Chapter 7 bankruptcy you, as the individual, are required to meet certain criteria to receive Chapter 7 relief, in particular income requirements. If you make too much money, you may be required to file for Chapter 13 bankruptcy instead.
When filing for Chapter 7 bankruptcy, an order immediately stops most creditors from following up with collection efforts and a trustee is appointed to administer your case. In most cases Chapter 7 bankruptcy works better for low-income individuals with little to no assets. To learn more about Chapter 7 bankruptcy in more detail, read more here.