Chapter 7 Bankruptcy in Maryland

A Chapter 7 bankruptcy can be filed to cancel most or all of your debts. A trustee may sell some of your property to payback creditors. Chapter 7 bankruptcy is sometimes referred to as “simple” or “straight” bankruptcy. There is no payment plan afterwards like there is in a Chapter 13 bankruptcy. The bankruptcy process takes about 6 months.

Non-Dischargeable Debt

Bankruptcy cannot be used to relieve debt child support, and most student loan and tax debts absent an extraordinary hardship.

Eligibility for Chapter 7 Bankruptcy

Not everyone is eligible for a Chapter 7 Bankruptcy. Generally anyone who has previously filed for bankruptcy must wait 4 to 7 years before they can file for another bankruptcy. Your income, debt burden, and expenses may also preclude you from filing for a straight bankruptcy and force you into a Chapter 13 repayment plan.

What is an Automatic Stay?

An Automatic Stay immediately halts all debt collection efforts against you. It takes effect the moment a bankruptcy is filed. Creditors must stop garnishing your wages, emptying your bank account, and taking your house or car. It is an amazing way to get immediate relief.

Credit Counseling Courses

Petitioners who file for bankruptcy must take two mandatory classes. A Credit Counseling Course must be completed before filing for bankruptcy, and a Debtor Education course must be completed after your case has been filed.

What goes in a bankruptcy petition?

A bankruptcy is done by completing forms that inform the bankruptcy trustee of your financial situation. These forms include your property, income, expenses, debts, and property sold or given away in the last two years. In addition, Maryland law allows you to keep some of your assets such as equity in your home, social security payments, clothing, household furnishings, a car, and other necessities. They must still be included in your petition as an exemption. If not included in the petition you could forfeit your right to your property.

341 Creditors Meeting

After filing for bankruptcy a creditors meeting will be scheduled. You will be required to attend Court and answer questions under oath to the bankruptcy trustee assigned to your case. Your attorney will attend your meeting with you and represent you. The bankruptcy trustee may require you to surrender some of your property or its equivalent in cash to payback your creditors. Your secured debts (such as a house or car loan) may be foreclosed on or repossessed to payback creditors.

The Pendergraft Firm LLC Chapter 7 Bankruptcy Practice

Brian Pendergraft is a Maryland attorney that greatly enjoys assisting clients with debt relief. Call us at (301) 205-9013 or E-mail [email protected] to schedule a free phone consultation!