Will I Lose Property With A Chapter 7 Bankruptcy Filing?

Posted by Michigan Bankruptcy Law Firm on July 8, 2010 · 2 Comments

Chapter 7 bankruptcy cases don’t include filing a plan of repayment like they do Chapter 13. In a “7″ the bankruptcy trustee identifies and distributes the debtor’s nonexempt property and uses the proceeds of the sale of such property to pay creditors per the guidelines in the Bankruptcy Code. A portion of the debtor’s assets might be subjected to liens and mortgages that promise the assets to different creditors. It’s important to keep in mind that the Bankruptcy Code permits the debtor to retain some “exempt” property; but a trustee will liquidate the rest of the debtor’s assets. Therefore, debtors need to know that by submitting a petition under Chapter 7 can, in some cases, result in the sacrifice of property. However, in the majority of cases, there is little or no non-exempt property to lose. Which makes a Chapter 7 bankruptcy attractive.

If you’re considering a Chapter 7 bankruptcy in Michigan, let our experienced bankruptcy lawyers help you to understand your options.