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What Kinds of Debts Can Chapter 7 Eliminate?

Oct. 8, 2021

If you’re experiencing financial problems and have started looking into bankruptcy, there is a good chance that you’ve learned that Chapter 7 bankruptcy can eliminate certain debts. You may be wondering, however, whether it can eliminate the kinds of debt that you have. The good news is that Chapter 7 can eliminate most consumer debts, including:

  • Medical bills

  • Credit card debts

  • Utility bills

  • Certain tax debts

  • Civil judgments

  • Personal loans

  • Business loans

  • Auto loans

  • Old Apartment Debt

Some notable types of debt that Chapter 7 usually cannot eliminate include student loans, past-due child support, and alimony payments. A St. Louis bankruptcy attorney can review your financial situation and determine whether bankruptcy is advisable for you.

How Does Chapter 7 Bankruptcy Eliminate Debt?

Chapter 7 bankruptcy is often referred to as "liquidation bankruptcy," as it involves the sale of a debtor's non-exempt assets in order to pay back creditors. This is often misleading as the vast majorities of Chapter 7 bankruptcies do not require any sale of property.

While this may sound like people who file for Chapter 7 are left without anything, the reality is that there are ample exemptions available under the bankruptcy code. In fact, most Chapter 7 bankruptcy cases are zero-asset bankruptcies, meaning that most people who file do not have to give up any of their assets to enjoy the benefits of the bankruptcy discharge.

Can I File for Chapter 7 Bankruptcy on My Own?

As someone who is experiencing financial problems, it’s likely that you are looking to save money wherever you can. You may even be considering trying to file for bankruptcy on your own to save legal fees.

It’s highly advisable to retain an attorney to represent you and handle your bankruptcy paperwork when filing for Chapter 7. In fact, even the United States Courts strongly recommend seeking the advice of a qualified attorney. Filing Chapter 7 requires the careful preparation of documents and a thorough understanding of the law. Any mistakes you make could significantly affect the outcome of your case and - in a worst-case scenario - result in potential criminal liability as a result of bankruptcy fraud.

Some of the specific ways a lawyer can help you include determining whether bankruptcy is right for you, advising you under which chapter you can file, letting you know whether your debts will be discharged, advising you as to whether you can keep your home or other important assets, preparing your petition and supporting documentation, and representing you in court.

Contact Us Today to Speak with a St. Louis Bankruptcy Lawyer Today

If you are struggling with debt and keeping up with your bills, bankruptcy may be able to help. At AKS Law, we know how to help consumers like you get a fresh financial start and eliminate debt. To schedule your free case evaluation with a bankruptcy attorney in St. Louis, call our office today or contact us online.