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Chapter 7 Bankruptcy Process

The purpose of the Chapter 7 Bankruptcy law is to liquidate the debtor's nonexempt (i.e., unprotected and unencumbered) property for the benefit of creditors. When a Chapter 7 case is filed, a trustee is appointed to administer a bankruptcy estate of the debtor's nonexempt assets. From assets liquidated by the trustee, the estate pays the trustee's compensation and expenses and distributes the remaining proceeds according to priorities set forth in the bankruptcy code.

Within 2-3 days after a Chapter 7 case is filed, the Court Clerk mails a notice to affected creditors setting a Meeting of Creditors in 25-40 days. The debtor appears at the meeting and answers questions posed by the trustee and occasionally by creditors (if any) who elect to attend.

The creditors and the trustee have between 10 and 60 days after the meeting to object to:

	the discharge of individual debts
	the debtor receiving a discharge in general
	any alleged abuse of bankruptcy law because (based on the Means Test) a five-year Chapter 13 monthly repayment case was not filed instead of the Chapter 7 case
	improper filing issues, or more commonly, requests for proof (Our filings almost never result in further requests for proof or evidence.)

In those cases that have resulted in additional review over 95% have resulted in the obtaining the same degree of relief as originally sought.



Please note that the new Washington Homestead is changing the usefulness of Chapter 13 because more persons can save their home now under Chapter 7 in Washington.

To summarize, in the vast majority of cases if the attorney has done his or her job correctly, the trustee issues a report of no asset/distribution, and the debtor walks away having cancelled the obligation to pay debts, obligations and loans.



As stated on other pages in this site:

The first question is whether you could get relief under either chapter.

Next, you decide which chapter gives you the best debt-discharge and asset preservation combination (which usually, but not always, is Chapter 7 over Chapter 13).

Finally, after deciding which path is best for you, we gather the necessary financial documents and prepare your Bankruptcy Petition. In the meantime, you must complete a credit counseling class. After reviewing your petition with you, we will file it. Once the Bankruptcy Petition is filed, creditors are forbidden from contacting you personally. After your petition is filed, you will need to attend a 341 Hearing, which is typically a very straightforward and relatively painless process. Once you are through the 341 Hearing, your qualifying debts will be fully discharged approximately 60 days later.




At the Law Offices of Lawrence S. Lofgren, we serve the Greater Seattle area including: Everett, Lynnwood, Edmonds and Bothell.

Please call us for a free consultation:

Seattle: (206) 624-3644  
Everett: (425) 953-4364