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Texas Bankruptcy - Chapter 7
Chapter 7 laws liquidate debts without payment. Chapter 13
requires that debts are repaid, in whole or in part, over a term of
months. Because of these uniquely exclusive purposes, the impact of a Chapter 7 Texas bankruptcy is quite different
as compared to a Chapter 13 Texas bankruptcy. The term "straight bankruptcies" is old term which still survives today and is sometimes used to describe
cases filed under Chapter 7.
Most consumer debts are dischargeable. Routine discharges are available for mortgage deficiencies, car notes,
credit cards, accounts payable, and many others. Certain debts are not dischargeable, and in general, include
liabilities owed to government authorities (taxes, fines, penalties) and civil liability for debts imposed on
others without permission (child support, judgments for damages, DWI, DUI, theft, fraud, etc.).
Texas Bankruptcy Protection
The primary purpose of Chapter 7 laws is to discharge
debts and provide debtors a "fresh start." However, all people who file are not
entitled to a discharge of all debts. Limitations are imposed on who may file, and the particular debts that may be
discharged. Texas bankruptcy courts are charged with an affirmative duty to review compliance with all
applicable rules and statutes. Likewise, trustees and creditors may file objections and direct the courts
attention to noncompliance. Depending upon the classification for each debtor who files and classification of
debts included within the estate, the application of Chapter 7 laws
is unique for each person who files.
In practice, most individuals who file Texas bankruptcy under Chapter 7 do receive a discharge without surrendering significant assets.
Most often, this favorable result for debtors occurs after careful review and planning. If significant assets are subject to seizure, or discharge of
debts is questionable, debtors often choose reorganization or avoid filing altogether using one of the many
alternatives available today. Avoid all surprises.
For best results, debtors must carefully plan the selection of chapter, date of filing, and options. All options are not available to all debtors because of variation in financial histories, assets owned, and new income restrictions. Because of the complex nature of recent changes in federal law, the assistance of a qualified attorney or law firm is essential. With assistance, effective debt relief is readily available through the bankruptcy courts. Back to Texas Bankruptcy types.
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