How To File For Chapter 7 Bankruptcy Massachusetts

by Lois Gordon

Chapter 7 bankruptcy Massachusetts is one of the common forms of bankruptcy that individuals file for. It is very different from Chapter 13 because no debts are paid on a monthly basis and in fact, all or part of the debt may be discharged. This form is usually applicable to people who cannot afford their debts so high income individuals may not qualify for this form and may instead qualify for the other type which involves making monthly payments for three to five years.

The Bankruptcy means test is used to determine whether an individual qualifies filing this type of bankruptcy process. Those who earn more than the state's median income do not qualify for Chapter seven filing procedures. If they are married, have high student loans and live in an area of the state that is lenient, they may be able to file despite having a higher income.

Student loans and tax liabilities are not forgiven under any bankruptcy procedures and failure to pay can lead to imposing of liens on the debtor's assets. However, car debts and credit card balances may be forgiven under this type of procedure. It stays on the applicant's credit report for ten years at which time the individual is not able to get any loans because of their inability to pay the previous debts they had. After the ten year period ends, there is no record of any filing on the person's credit report.

Liquidation is a major part of this type of proceeding where the court takes over the debtor's assets and sells them in order to get cash that can be used to pay off one's debt.If one has big item assets such as a house or cars, then it is better to file the 13 type which gives one more time to pay off their debts in three to five years.

In addition, this type of filing is not the appropriate one for these people who have foreclosures pending against their homes. Chapter 13 works best in this case as one is able to save their home from being reclaimed by the bank. It gives the applicant more time to pay off the debt and only stays on one's record for seven years.

Chapter 7 bankruptcy Massachusetts and Chapter 13 are the most widely known forms of proceedings for one's inability to pay creditors. In this ruling 7, the individual's assets and property are sold in order for them to repay debt owed to creditors. However, not all people qualify for this type of proceeding and high earning persons are better off applying for Chapter 13. <A href="http://www.cambridgebankruptcylaw.com">chapter 7 bankruptcy Massachusetts</A>

Learn more here: <a href="http://www.cambridgebankruptcylaw.com">chapter 7 bankruptcy Massachusetts</a>

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