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Sadeghi & Associates
5 Hutton Centre Drive
Suite 900
Santa Ana, CA 92707
(714) 545-2388
FAX (949) 315-3045
sidney@sadeghilawfirm.com
INFORMATION ON CHAPTER 7 BANKRUPTCY
What you need to know from Sadeghi & Associates. Contact our office for a free consultation today.
What is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is a liquidation proceeding wherein the debtor turns over all non-exempt property to the bankruptcy trustee who then converts it to cash for distribution to the creditors. The debtor receives a discharge of all dischargeable debts usually within four months.

Do I Qualify for Chapter 7 Bankruptcy?
Chapter 7 eligibility is partially determined by a “means test”, which compares your income to the median income in your state for a family the same size as yours as determined by the IRS. Eligibility is also determined by comparing the amount of your disposable income to the amount of your unsecured debts.

Contact our office today for a free consultation to see if you qualify for Chapter 7 Bankruptcy.
Will Chapter 7 Bankruptcy Discharge All of My Debts?
No. Filing for Chapter 7 Bankruptcy will discharge most of your debts, but not all of your debts. The following debts will not be discharged:
Any lien on personal or real property. Although the debt will be discharged, you will not be able to keep the security if you do not pay for it.
Most income taxes incurred in the last 3 years.
All student loans, unless you qualify for a hardship discharge.
Child or spousal support, and certain debts related to divorce proceedings.
Any debts owed as a result of injuring or killing someone while you were operating a motor vehicle, vessel or aircraft under the influence of alcohol, drugs, or another substance.

How Will Filing for Chapter 7 Bankruptcy Affect My Credit?
The bankruptcy will appear on your credit report for up to 10 years after you file. Although this is a disadvantage to filing for bankruptcy, it is not as serious as it may seem. Credit lenders are aware that you will not be able to file for Chapter 7 bankruptcy for another 8 years, so they do not have to bear the risk have their debt immediately discharged again if they extend you credit. Although you may not be able to obtain as a high credit limit as you had before, obtaining a line of credit should not be impossible. And keep in mind that credit can be rebuilt over time.