
Chapter 7 Bankruptcy Process in Washington DC
Chapter 7 Bankruptcy Explained by Our Attorney
Filing for Chapter 7 bankruptcy consists of a supervised liquidation process. During this time, a court-appointed trustee sells a debtor’s assets and distributes the sale proceeds to creditors. This is in full satisfaction of any debts owed.
Determining Chapter 7 Eligibility
Before filing for Chapter 7 bankruptcy, you must understand eligibility requirements. Such requirements include:
- Residence, domicile, place of business or property owned in the United States
- No prior Chapter 7 bankruptcy discharge within the past eight years
- No prior bankruptcy filing dismissed for cause within the past 180 days
- It must not be fundamentally unfair to grant the debtor relief under Chapter 7
In addition to these requirements, it must not be a “substantial abuse” of Chapter 7 to grant the debtor bankruptcy relief. In determining whether a debtor qualifies, bankruptcy courts apply a “bankruptcy means test”. This test determines whether they meet the monetary requirements for bankruptcy. If a debtor’s income is in excess of certain thresholds, then the debtor may not be eligible for Chapter 7 relief.
Chapter 7

Meeting of the Creditors
Twenty to forty days after the debtor files the petition for bankruptcy, the trustee must hold a meeting of the creditors. During this meeting, the debtor must appear and answer, under oath, any questions regarding his or her assets and liabilities. Following the meeting of the creditors, the trustee controls all non-exempt assets and he/she can sell them as he/she sees fit.
Unsecured creditors have 90 days after the meeting of the creditors to file their claims with the court. However, if the case is a no asset case, creditors do not typically file their claims because there will be no distribution. If there are non-exempt assets, the trustee will distribute sale proceeds according to the six classes of claims detailed under §726 of the Bankruptcy Code. Under this scheme, each class of creditors must be paid in full before the next lower class is paid.
What is A Reaffirmation Agreement?
If a debtor owns secured property, he should either return the property or reaffirm the debt. In a reaffirmation agreement, the parties agree that the debtor will repay all or part of an otherwise dischargeable debt. In exchange, the creditor promises that he will not repossess the property. If, however, the debtor fails to comply with the repayment terms, the creditor may repossess the property. To be effective, the debtor must sign a reaffirmation agreement and file it with the court prior to discharge.

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Discharge of Debt
Creditors and the trustee have 60 days after the creditors’ meeting to challenge the debtor’s right to discharge. A court may refuse discharge if the debtor did not produce financial records, failed to explain a loss of assets, committed perjury during the meeting of the creditors, fraudulently conveyed property, did not complete the required financial management course, or failed to comply with any other court order. If no such challenges are made, then the debt is discharged within four to six months of filing the petition. However, certain debts, such as student loans, tax deficiencies, government fines, and criminal fines, are not dischargeable in Chapter 7 bankruptcy. For more about the discharge of debt, see “Chapter 7 Discharge”.
We Can Explain Chapter 7 Bankruptcy to You
Bankruptcy can be a very complicated and frustrating process. If you are facing the possibility of bankruptcy proceedings, it is important that you contact a qualified MD or Washington DC Chapter 7 attorney to assist you throughout the process. Attorney Kevin D. Judd has experience in both Maryland and Washington DC bankruptcy proceedings. He has helped clients since since 1994. Please contact our Chapter 7 bankruptcy lawyer now for a free consultation to discuss your financial situation

