In America, the Chapter 7 bankruptcy law often allows people who are facing major financial burdens to start fresh. The court makes this happen, if it grants a person's petition, by liquidating many of their outstanding debts. This means the debts are legally gone after the court grants relief.
Chapter 7, however, is one of two options. The other is a restructuring process, usually Chapter 11 for businesses and Chapter 13 for individuals.
Chapter 7 bankruptcy is something you can pursue if you need extreme relief from your debts. If you want to file, you might want to learn a few things before you choose this debt-relief tool. Learning about Chapter 7 can help you know if it is right for you, and here are four facts to know before you file.
1. You Can Keep Exempt Property
The first fact about Chapter 7 is that you risk losing some of your assets.