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Filing for Chapter 7 bankruptcy

Filing for bankruptcy can be a challenging and difficult decision. Kentucky residents struggling with debt can benefit from filing for Chapter 7 bankruptcy, but it is vitally important for them to understand the specifics of such a filing and how it will affect their finances moving forward. The support of a dedicated bankruptcy attorney can be helpful in tackling this complicated process.

Generally speaking, Chapter 7 bankruptcy is filed when an individual or family can no longer handle debt payments required by creditors. In advance of filing, the federal Bankruptcy Code requires anyone filing for bankruptcy to complete mandated credit counseling as well as debtor education programs. Once these courses are complete and the petition is filed, the court assigns a trustee to take a thorough accounting of the overall financial landscape of the filer, including accrued debts and assets. Some of these assets may be liquidated to pay down existing debt, though some exemptions under state and federal law often preclude the necessity to liquidate specified assets.

Discharged debts tend to be unsecured, like medical or credit card debt. Some debt, like student loans or alimony payments, are rarely -- if ever -- considered for discharge. Student loans could be eligible it they meet a stringent hardship test. Bankruptcy is a complicated process involving a great deal of paperwork, and is best navigated with the help of a seasoned bankruptcy attorney. 

Chapter 7 bankruptcy can be a scary prospect. Nevertheless, it can create a road to financial stability that might otherwise be inaccessible. With the help of a bankruptcy attorney to guide filers through the court proceedings, debt can realistically become a thing of the past for struggling Kentucky families.

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