Chapter 7 is the most widely-known type of bankruptcy, and it involves the use of income and liquidation of all non-exempt assets to repay as much debt as possible. In return, the court forgives the business or individual of any and all remaining debt. In many cases, a person may go through chapter7 bankruptcy without losing any assets, either if the person has no assets, or if those assets have been deemed to be exempt. This is generally the fastest way to file for bankruptcy and can be concluded in short order with the assistance of a skilled bankruptcy lawyer.
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Due to generous bankruptcy laws in Florida, there are a variety of different assets that can be exempted from the liquidation process in Chapter 7 bankruptcy. Some of those exemptions include the person’s home, retirement accounts, benefits and many other personal or business assets. Debtors may also be allowed to keep automobiles and personal possessions such as jewelry or gifts, and can even keep money saved in the bank from wages. In many cases, an individual or business may be allowed to undergo the bankruptcy process without losing anything at all. There are a lot of complicated details that may determine what can and cannot be excluded from liquidation, however, so be sure to consult a professional before moving forward.
The federal government passed new bankruptcy reform legislation in October 2005. However, don’t be discouraged! Most studies indicate that the new law affects less than 15% of individuals who could have filed previously. If you are feeling overwhelmed by your debts and considering filing bankruptcy, it is highly probable that you fall into the category of the 85 percent of people who are still eligible to file.