Filing for Chapter 7 Bankruptcy in Newtown, CT
What is Chapter 7 Bankruptcy?
The most common type of bankruptcy filing falls under the Chapter 7 category. This is applicable for both Connecticut and New York, as well as the entire United States. Filing for a Chapter 7 Bankruptcy allows for most debts to be removed, which can enable a fresh start for debtors. The Chapter 7 Bankruptcy process does require, though, debtors to liquidate assets. This liquidation can result in a loss of property and a lower credit score. Chapter 7 is also recognized as a “straight bankruptcy” due to the action taken directly with the creditors. Assets are sold to make necessary payments. When the bankruptcy process is complete, accumulated debt is forgiven and dismissed. Knowing when to start the bankruptcy process and file for it can be a hard decision to make. Romanello Law Firm can help all our Newtown clients with this decision.
As with most legal practices, there are required steps when filing for Chapter 7 Bankruptcy. For the application to be accepted by the court, debtors must have a business with a sizeable amount of debt or a household income that is below the median state income. A “mean test” can help determine the accurate level of household gross income.
How Does Chapter 7 Work
There is a distinguished process for filing a Chapter 7 Bankruptcy, and we can help you along the whole way. It begins with a professional petition for bankruptcy, and establishment of a schedule, and a statement of affairs. This filing process can take anywhere from four to six months. Filing the petition for a local court in the Newtown area can usually promote a quicker process. Certain information will be required in the Official Bankruptcy form, including:
- A list of all creditors and the amount and nature of their claims
- The source, amount and frequency of the debtor’s income
- A list of all the debtor’s property
- A detailed list of the debtor’s monthly living expense, food, clothing, shelter, utilities, taxes, transportation, medicine, etc
We encourage our Newtown clients to cooperate with our trustees and attorneys, as this can keep the process smoother. Providing required documents and information and relinquish unnecessary burdens.
The Chapter 7 Discharge in Newtown, CT
A discharge will be given to the debtor when the filing process is accepted and completed. Accumulated debt is removed, and paying off debts in their entirety is no longer expected. With the Chapter 7 Bankruptcy, debtors will also be expected to liquidate assets to make necessary payments.