Therefore, you must decide whether you wish to surrender the collateral or retain it by paying for it. Tools of trade up to ,625 or ,250 if both spouses are engaged in business. Cash surrender value of life insurance policies up to ,200 or ,400 for a married couple. 75% of cash and bank balances traceable to earnings of an employee paid within the last 30 days. The court looks at all of your income received in the 6 months before the month in which the case is filed, except social security.Usually you can keep your house or car by continuing payments according to the terms of the contract. If your average income is below median income for a household of your size according to the Census Bureau, it is presumed that you are eligible for a discharge.
Your obligation to pay the debt is “discharged.” Secured Debts: When your agreement with a creditor allows the creditor to take specific property from you if you don't pay, the debt is "secured" by the property which is referred to as "collateral." Examples of secured debts are car and house loans, but also may include accounts with retailers who sell durable items like furniture, appliances, and jewelry. ,925 of any kind of property (commonly referred to as the "catch-all" or "wild card" exemption) in addition to those below. Household goods, furnishings and supplies up to 0 per item with no maximum total. Means Test: If the majority of your debt is business debt, you cannot be denied a discharge based on your ability to pay.In a chapter 7, the secured debt is discharged, but the creditor does not lose its right to collect against the collateral. If the majority of your debt is consumer debt, the court can deny a discharge and dismiss the case, or you can convert it to a case under chapter 13, based on your ability to pay.What Happens to Collateral on My Secured Debts in Chapter 7?A debtor has four options on secured debts, where the creditor is holding collateral to enforce the payment of the debt.Both types of bankruptcy, liquidation and reorganization, have numerous rules and exceptions.
Which Chapter is right for you is dependent upon your particular circumstances and objectives.Many of the company's stores were in shopping malls.Based on 2005 revenue, Mervyn's was the eighty-third largest retailer in the United States.At the time of your initial consultation, the attorneys of our firm will discuss the implications of applicable exemption laws.Certain debts are not dischargeable in a Chapter 7 bankruptcy.In Chapter 7, most of the debtor’s property or assets are protected by law (See explanation of exempt assets below).