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Snohomish County, WA Bankruptcy Lawyers

Everett | Edmonds | Lynnwood | Marysville | Arlington

Everett Chapter 7 Bankruptcy Attorneys

(425) 953-4364

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(425) 953-4364

Experienced Everett Chapter 7 bankruptcy attorneys

The basics of a Chapter 7 bankruptcy.

A Chapter 7 case is a “liquidation bankruptcy”.  That means, if creditors receive any money in the process, it comes from liquidating assets – converting property into cash to pay your creditors.  The creditors have an opportunity to file a claim with the bankruptcy court and they get paid a pro rata share based on the percentage of the overall debt they have. 

This may seem complicated.  In reality, however, it's not.  One of our Everett Chapter 7 bankruptcy lawyers can explain the process to you in more detail when you call our offices.  Most of our Chapter 7 clients are able to successfully "discharge" or wipe out all of their debts.  At the same time, we are often able to "exempt" all of their personal property and assets, which means that they get to keep everything they own.

Lose your debts.  Keep your property.

Most people in Chapter 7 do not lose any property.  Most basic property is “exempt” from being taken.  Don't worry, most everything you own is probably safe.  Our Snohomish County Chapter 7 bankruptcy attorneys can fairly easily determine what property you have, if any, that might not be exempt. 

Once a Chapter 7 case is filed, a trustee is appointed to investigate if there are any assets.  Your bankruptcy forms include a list of all your property, your debts, your income and your budget along with other financial details.  You also have to provide supporting documentations to the trustee before your “meeting of creditors”, which is the only hearing you are likely to have to attend.  And, don't worry.  It's almost always a very painless hearing.  Plus, one of experienced Everett Chapter 7 bankruptcy lawyers will be with you at this hearing with you.

This hearing takes place about a month after you file your case.  The trustee examines your petition and other documents and asks you follow up questions.  Creditors rarely appear.  Your petition needs to include a list of exemptions to your property.  If the trustee thinks there is some property that isn’t exempt, he or she might investigate  further.  Of course, your attorney will be at the hearing with you and assist you in providing the documents to the trustee.  In the majority of cases, there is no follow up after the hearing and debtors get to keep all their property.

How do I qualify?

To qualify for a Chapter 7, you must show that you don’t have enough income to pay your debts.  If your household  makes over the median income for its size in Washington, you are subjected to a “means test”.  The means test determines whether you are presumed to be abusing the bankruptcy system by filing a Chapter 7.   One of our Everett Chapter 7 bankruptcy lawyers will help you determine if you can pass the means test.

Basically, it tests your ability to pay your creditors by deducting certain actual expenses, such as mortgage payments, taxes and health insurance and other standard expenses, such as food, clothes and gas, taken from the IRS rules for paying back delinquent taxes.  If there is money left over in this means test budget to pay something to your unsecured creditors (such as medical bills and credit cards), then you may have to file a Chapter 13 bankruptcy with payments lasting five years.

Before filing a Chapter 7, you have to take a credit counseling class, which usually lasts about two hours and is available on the internet or by phone.  After filing your case, you have to take a debtor education class, which also lasts about two hours and can be taken on the internet or over the phone.

About two months after your meeting of creditors, or about three months after filing your case, you should receive a discharge.  The discharge prevents creditors from trying to collect a debt from you ever again.  Not all debt is discharged – some debt, such as back alimony or child support, some back taxes and student loans cannot be discharged.  Most debt can be discharged, but you should talk to an attorney to be sure what debt you can discharge and what you can’t.

Everett Atorneys

(425) 953-4326

Wipe out your debts!

Keep your property and assets!

Assisting clients throughout Snohomish County

Everett Chapter 7

Bankruptcy Attorneys

(425) 953-4326

Low Flat Fees

Flexible Payment Plans

Struggling just to get by every month?

Drowning in debt?

We can help.

If you are able to qualify, filing a Chapter 7 bankruptcy is probably your best move.  A Chapter seven only takes about four months, and it wipes out 100% of your qualifying debts.  Our Everett bankruptcy attorneys can help you determine if you qualify for Chapter 7 bankruptcy protection and relief.

If you qualify, filing a Chapter 7 wipes out almost all of your unsecured debts including credit card debts, medical bills, utility bills, judgments, and lawsuits.  It also stops all repossession actions and assists in many other ways as well.  It also immediately stop all collection actions.

Filing a Chapter 7 immediately puts an "automatic stay" in place.  This automatic stay is federal law and is one of your guaranteed legal rights under the law.  If creditors continue to harass you after you have filed, they are in direct violation of the automatic stay and the Fair Debt Collection Practices Act.

In order to file, you cannot have previously filed and received a discharge in the previous 8 years.  Individuals, married couples and businesses can file a Chapter 7, though businesses do not receive a discharge.

In order to qualify for relief, you must meet certain income requirements.  Our Everett Chapter 7 bankruptcy lawyers are very familiar with the qualifying income thresholds and can review them with your during your initial consultation.  Most of our Snohomish County clients can still qualify for relief.

If you are over these income thresholds, you are presumed by bankruptcy law to be abusing the system.  But it may still be possible to qualify you by showing that your expenses take up all your income under the means test.

The means test is complicated calculation.  But we are very familiar with it, and we can determine if you can still qualify even if your income is above the baseline thresholds.

How does it work?

The process of a filing starts with filing a petition with the bankruptcy court.  The end result of a Chapter 7 is a “discharge”, which cancels your debt.

In most cases, it takes about three or four months for your case case to go from filing the petition to discharge.  The resulting discharge is an injunction against creditors taking any action to collect a discharged debt.  And, they can be sued for violating this injunction.

We will prepare your petition, which you will need to review in detail prior to filing.  The bankruptcy petition contains detailed information about your financial situation, such as a list of your property, a list of your debts, a statement of your income and expenses.  You must also file the means test form.

You also have to disclose certain transfers of property or money, especially to relatives, in the past two years.  Once you file your case, an “automatic stay” is put into place.  This “stays”, or stops, all collection activity, including phone calls, repossessions, foreclosures, law suits, garnishments – any attempt to collect a debt.  Creditors can be sued for violating the automatic stay.  A trustee is also appointed to administer your case.

Will I have to go to court?

Most people who file Chapter 7 only have to attend one hearing called a “meeting of creditors”, which occurs about a month after you file your case.  One of our Everett Chapter 7 bankruptcy lawyers will explain what happens at the meeting of creditors in more detail before your hearing.

The trustee reviews your petition and supporting documents such as pay stubs and bank statements and questions you under oath at the meeting of creditors.  Creditors rarely show up to these hearings.  The trustee investigates whether you have any property, or in some instances had any property, that could be used to pay your creditors.

The trustee also wants to make sure that you are following the laws and that your petition is accurate.  Most often, people who file have no contact with the trustee after the meeting of creditors.

Sometimes the trustee will want to investigate something further or may ask for amendments to correct inaccuracies in the petition.  We have the experience to guide you through the process with the least amount of worry and stress possible.