In Chapter 7 bankruptcy, your debts are wiped out in exchange for surrendering any non-exempt assets to a bankruptcy trustee. The majority of people in the Indianapolis area who file under Chapter 7 can exempt (protect) all of their property, which means they lose nothing but debt.
Indiana’s bankruptcy exemption laws now allow you to protect up to $19,300 in home equity and $10,250 in tangible personal property, which includes motor vehicles. These amounts are doubled in a joint case filed by a married couple.
The Chapter 7 process usually takes 3 to 4 months from the filing your bankruptcy petition to the entry of your discharge order. During that time, the “automatic stay” provision of the Bankruptcy Code stops almost all collection efforts.
Eligibility for Chapter 7 is governed by the “means test.” People who don’t qualify for Chapter 7 still have the option of filing under Chapter 13.
If you’re eligible, and it will accomplish your goals, then Chapter 7 is usually your best bankruptcy option.