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Chapter 7 Bankruptcy in Chicagoland

Cutler & Associates, Ltd. is a trusted expert in chapter 7 bankruptcy law, representing clients throughout the Chicagoland area. Our bankruptcy attorneys boast more than 30 years’ worth of collective experience and can ensure you receive the best possible results. Because filing bankruptcy is such a complex process, you should rely on a lawyer with expertise in the type of bankruptcy that is most applicable to your circumstances. Do not let the process, implications, or legalese intimidate you. Partner with a firm that has spent nearly three decades in the field. We will guide you through the proceedings, helping you understand any details that may present concerns or apprehension. Below are answers to some of the questions we frequently receive about Chapter 7 bankruptcy at our offices.

What is chapter 7 bankruptcy?

Chapter 7 bankruptcy is a component of the United States Bankruptcy Code that allows debtors the opportunity for a fresh start. It is sometimes called a “liquidation” or “straight” bankruptcy. Debtors who opt for this form of relief must forfeit any nonexempt property to a trustee, who then sells the assets to collect funds that will be used as partial repayments to creditors. But because the majority of debtors who choose to file chapter 7 bankruptcy do not have a wealth of nonexempt property, most retain some or all of their property. The debtor must obey court orders and rules to receive a chapter 7 discharge.

What are the prerequisites for filing chapter 7 bankruptcy?

The bankruptcy attorneys at Cutler & Associates, Ltd. will help you understand the requirements for filing chapter 7 bankruptcy in Illinois. You first must pass the “means test,” which is predicated on the Internal Revenue Service’s income statistics for your area. To pass the means test, your income must be below the median level or you must submit your income and expenses for governmental review. Our team can help you get your finances in order to begin the process of receiving a chapter 7 discharge.

What is a chapter 7 discharge?

A chapter 7 discharge is a court-ordered release of dischargeable debts. Once a debtor receives his or her chapter 7 discharge, creditors are no longer allowed to attempt to collect payment in most instances. However, creditors may still seek payment for debts that chapter 7 does not discharge, including:

  • Debts for certain taxes, such as those which were due in the previous three years
  • Debts for procuring money, credit, services, or property via fraud
  • Debts not listed on the bankruptcy filing unless the creditor was aware of the case with sufficient time to file a claim
  • Debts for fraud, embezzlement, or theft if creditors file claims
  • Debts for malicious or intentional injury if a creditor files a complaint
  • Debts for alimony, support, or various other funds related to divorce
  • Debts for certain fines or penalties
  • Debts for student loans that became due in the previous seven years unless a court determines not discharging the debt would lead to undue hardship for the debtor or his or her dependents
  • Debts for death or personal injury caused by a debtor while operating a motor vehicle under the influence of drugs or alcohol
  • Debts that were or could have been included in a previous bankruptcy case that did not result in a discharge

Who is eligible for a chapter 7 discharge?

Chapter 7 bankruptcy is an option available to any person who lives in, owns property in, or does business in the U.S. unless he or she was a party to another bankruptcy case that a court dismissed on certain grounds during the previous 180 days. However, it is not advisable to file chapter 7 bankruptcy in Chicagoland if an individual is not eligible for a discharge. The bankruptcy lawyers at Cutler & Associates, Ltd. will help you determine eligibility. Notably, persons who are ineligible for chapter 7 discharge include:

  • Those who were granted a chapter 7 discharge within the previous eight years
  • Those who were given a chapter 13 discharge within the prior six years, barring special circumstances
  • Those who file a court-approved waiver of discharge
  • Those who attempt to defraud their trustee or creditors by concealing, transferring, or destroying property
  • Those who falsify, hide, or destroy financial records
  • Those who make false claims or withhold information from their trustee
  • Those who cannot or do not satisfactorily explain deficiencies or losses of assets
  • Those who decline to answer questions or obey orders given by the bankruptcy court

When is the best time to file chapter 7 bankruptcy?

There are several factors to consider when determining the right time to file chapter 7 bankruptcy in Chicago, IL or the surrounding area. Cutler & Associates, Ltd. will help you understand when is best so that you can protect most or all of your assets. It is unwise to file chapter 7 bankruptcy if:

  • The debtor anticipates significant additional debts in the near future
  • The debtor expects to receive an income tax refund or other assets that would not be exempt
  • The debtor will receive property or money through inheritance, life insurance, or divorce within 180 days of filing because it would then become the property of the trustee

How can Cutler & Associates, Ltd. help?

As trusted and reliable bankruptcy attorneys in Chicagoland, Cutler & Associates Ltd. will provide advice and legal counsel throughout the bankruptcy process. Among the functions we typically perform in each case are:

  • Analysis of the amount and nature of the debts owed to determine the proper action
  • Explanation of available relief through chapter 7 bankruptcy and how it differs from chapter 13 bankruptcy
  • Assembly of the information and paperwork necessary for filing bankruptcy
  • Preparation of petitions, schedules, and statements for the bankruptcy court
  • Assistance arranging assets for maximum retention
  • Notification of the case’s commencement for creditors
  • Offering counsel during any meetings between the debtor and creditors
  • Participation in discharge and reaffirmation hearings

Contact Cutler & Associates, Ltd. Today

If you are overcome with stress related to ever-increasing debt, contact the compassionate team of bankruptcy attorneys at Cutler & Associates, Ltd. We will guide you through filing chapter 7 bankruptcy and ultimately deliver the best possible results for your circumstances. In the process, we will help you retain most or all of your property and decrease the disturbance that bankruptcy can cause. Contact us today for a free bankruptcy evaluation.