Also known as a "Fresh Start", a "Straight Bankruptcy", and liquidation”. Chapter 7 bankruptcy allows a person to eliminate most or all of his or her debt while keeping real and personal property as allowed by law.
In most cases, a person may keep their home or car (secured debt), provided that they continue to make current payments and are current on their loan.
Chapter 7 eliminates:
- Credit Card debts
- Medical debts
- Personal loan debts
- Lawsuit debts
- Judgments - Unless fraud or criminally related
- Deficiency debts on repossessed autos and foreclosures
- Some IRS Debts
- Most Personal Injury Debts caused by negligence
Chapter 7 does not eliminate student loans, except for undue hardship cases, certain taxes, alimony, child support, fines, penalties, criminal restitutions, debts incurred through fraudulent conduct, debts incurred through intentional injury to person or property, or debts from personal injuries caused by driving while intoxicated.