Things To Know About Chapter 7 bankruptcy laws
The Chapter 7 Bankruptcy Code allows you to keep property or assets by claiming them as "exempt" under either Federal or State exemption laws.Chapter 7 bankruptcy provides an "order of relief" that triggers an "automatic stay" thus all creditors and collectors are prohibited from pursuing you or your property outside of the bankruptcy proceeding. This is especially important if you've received a foreclosure notice.
Chapter 7 bankruptcy is also known as a "straight bankruptcy" or "liquidation bankruptcy" because the Trustee gathers and sells your nonexempt assets and then distributes the proceeds to your creditors in accordance with the provisions of the bankruptcy code.
Chapter 7 bankruptcy is also known as a "straight bankruptcy" or "liquidation bankruptcy" because the Trustee gathers and sells your nonexempt assets and then distributes the proceeds to your creditors in accordance with the provisions of the bankruptcy code.
The debts of the corporation or partnership theoretically continue to exist until applicable statutory periods of limitations expire. In the case of fraud, (for example, charging up credit cards with the intent to file a bankruptcy) the court may deny the discharge of the debt. For the court to take such drastic measures to limit or deny the discharge in a Chapter 7 proceeding, the creditor has the burden of proving that the debtor obtained credit by fraudulent practices or has engaged in other prohibited behavior. In a Chapter 7 case, a corporation or partnership does not receive a bankruptcy discharge-instead, the entity is dissolved. Only an individual can receive a Chapter 7 discharge. Once all assets of the corporate or partnership debtor have been fully administered, the case is closed.
Often these debts will be liquidated with the use of a CRO. This is a court appointed officer who is required to auction the properties of the concerned company. In the case of L.I.D. for example, the CRO was Consensus Advisors LLC. They performed an initial due diligence to find a suitable "stalking horse bidder." The stalking horse bidder was then required to provide a guarantee that at some minimum "reserve".
In a Chapter 7 filing, once the property distribution occurs, the court will most likely discharge the debtor from further repayment obligations to the unsecured creditors. However, there are some exceptions to this general rule. The discharge of the debt may not be allowed by the court if evidence shows the debtor used fraudulent behavior to incur the debt.
Chapter 7 bankruptcy is also known as a "straight bankruptcy" or "liquidation bankruptcy" because the Trustee gathers and sells your nonexempt assets and then distributes the proceeds to your creditors in accordance with the provisions of the bankruptcy code.
Chapter 7 bankruptcy is also known as a "straight bankruptcy" or "liquidation bankruptcy" because the Trustee gathers and sells your nonexempt assets and then distributes the proceeds to your creditors in accordance with the provisions of the bankruptcy code.
The debts of the corporation or partnership theoretically continue to exist until applicable statutory periods of limitations expire. In the case of fraud, (for example, charging up credit cards with the intent to file a bankruptcy) the court may deny the discharge of the debt. For the court to take such drastic measures to limit or deny the discharge in a Chapter 7 proceeding, the creditor has the burden of proving that the debtor obtained credit by fraudulent practices or has engaged in other prohibited behavior. In a Chapter 7 case, a corporation or partnership does not receive a bankruptcy discharge-instead, the entity is dissolved. Only an individual can receive a Chapter 7 discharge. Once all assets of the corporate or partnership debtor have been fully administered, the case is closed.
Often these debts will be liquidated with the use of a CRO. This is a court appointed officer who is required to auction the properties of the concerned company. In the case of L.I.D. for example, the CRO was Consensus Advisors LLC. They performed an initial due diligence to find a suitable "stalking horse bidder." The stalking horse bidder was then required to provide a guarantee that at some minimum "reserve".
In a Chapter 7 filing, once the property distribution occurs, the court will most likely discharge the debtor from further repayment obligations to the unsecured creditors. However, there are some exceptions to this general rule. The discharge of the debt may not be allowed by the court if evidence shows the debtor used fraudulent behavior to incur the debt.
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If you are finding the task of filing bankruptcy difficult, please visit www.Bankruptcy-Laws.org today to make the task quick and easy.
posted by Credit Counseling at
10:46 AM
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