Overview of Chapter 7 Bankruptcy

Chapter 7 bankruptcy is the most common form of bankruptcy.  Over 90% of consumer bankruptcies are Chapter 7 bankruptcies.  It is commonly known as a “liquidation bankruptcy”, but that does not mean you have to get rid of all of your things.  You get to keep essentially all the things you need.  This varies from state to state, but every state has provisions for keeping your home, your car, and you household goods.  The only thing you really need to worry about getting rid of are things that you could sell to pay your creditors.  If you have a set of nice jet skis, you will have to give those to the trustee if you have not already sold them.  Otherwise, you get to keep your stuff, and nobody comes over to your home to count your forks, so it is really not that painful.