Understanding Chapter 7 Bankruptcy

Helping Missouri & Illinois residents explore debt relief options with clarity and confidence.

What is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is a legal process designed to help individuals eliminate

or discharge most unsecured debts such as credit cards, medical bills, personal

loans, and more. It offers a fresh start for those overwhelmed by debt.

Also known as "liquidation bankruptcy." Chapter 7 allows a court-appointed

trustee to sell non-exempt assets to repay creditors. However, most people filing are able to keep their essential property.

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Who Qualifies for Chapter 7?

To qualify for Chapter 7 bankruptcy, you must pass the means test. This test compares your income to the median income in Missouri or Illinois. If your income is below the median, you likely qualify.

Even if your income is above the median, you may still qualify after considering allowable expenses.

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What Debts Can Be Discharged?

Chapter 7 can eliminate many unsecured debts, including:

• Credit card debt

• Medical bills

• Personal loans

• Utility bills

• Old judgements

However, certain debts are not dischargeable, such as student loans, child support, alimony, and most tax debts.

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How Long Does Chapter 7 Take?

Most Chapter 7 cases are completed in 3 to 6 months. The process includes:

1. Filling your petition

2. Attending the 341 meeting of creditors

3. Completing a financial management course

4. Receiving your discharge

It's one of the fastest ways to get a fresh start.

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Will I Lose My Property?

Missouri and Illinois have exemption laws that allow you to protect certain property, such as your home, car, personal belongings, and retirement accounts. Our office will help you understand what you can keep.

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Get Help From a Trusted Bankruptcy Attorney

Filing for bankruptcy is a big decision. You don't have to face it alone. Our experienced team is here to guide you every step of the way.

Disclaimer: This article is provided for informational purposes only and does not constitute legal advice. For guidance regarding your specific situation, please contact A & L, Licker Law Firm, LLC directly.