Chapter 7 Bankruptcy: How to Get Rid of your Debts

People in debt often think of ways out. Being in debt is never pretty and brings in a lot of stress. So, many file for bankruptcy. In chapter 7 bankruptcy, one can wipe off all the debts and have a fresh new start.

In the case of bankruptcy chapter 7 Texas, one can apply for bankruptcy, which will ensue the liquidation. It is where the trustee collects all of the assets and sells any assets which are not exempt. The trustee will sell the assets and pays the debtor any amount exempted.

Certain debts aren’t eligible under chapter 7 bankruptcy like alimony, child support, fraudulent debts, individual taxes, student loans, and certain items charged.

Anyone who has massive credit card debts and very few assets can use the Chapter 7 bankruptcy way out. In most cases of credit card bankruptcy, the person is able to eliminate all of these debts completely.

There is also the option of keeping certain assets if you wish, like a car or furniture or jewelry. But one must sign a voluntary “Reaffirmation Agreement” for that. Signing a reaffirmation agreement means you can’t file for bankruptcy.

It means a person will have to continue paying the debt as they were supposed to. That means they cannot bankrupt (or wipe-out) that debt again for eight years. However, there is another condition of reaffirming debts; it means that a person will have to bring the debt to the current state.

That means the debt must be paid until the current month. If you three or four months behind on your debt, then you must pay the back payments, which are due to reaffirm it.