A Chapter 7 bankruptcy is the most common type of bankruptcy in San Diego, and is often referred to as a "fresh start" bankruptcy. In a Chapter 7, a Chapter 7 trustee is appointed to the case. The trustee's duties include marshaling non-exempt property of the debtor, if any, selling that property for the benefit of creditors, and eventually distributing sale proceeds to creditors. The debtor usually receives at the close of the case a discharge (foregiveness) of the debts. In a Chapter 7 there are no debt ceiling limits that cannot be discharged. All exempt assets of the debtor (determined by federal and state exemption statutes) will ultimately be retained by the debtor after the bankruptcy. Typical examples of assets (property) you usually can keep are your home (subject to payment of the mortgage(s) and the amount of equity in the property), your motor vehicles (to the extent allowed by law), personal assets such as clothing, furniture, furnishings and appliances, whole life insurance policies subject to certain limits, and your retirement plans such as a 401(k) and IRAs. This is not an exhaustive or all-inclusive list of assets you may be able to keep. You may have assets not listed here that may also be capable of being deemed exempt.
Facts on Chapter 7 Filings:
In the majority of San Diego Chapter 7 bankruptcies, most, if not all assets are exempt (protected) from loss to creditors. This outcome is typical but each case can vary depending on the facts of the debtor's case. In some cases not all of the debtor's assets can be fully protected.
Certain debts are NOT dischargeable, namely, recent income taxes, student loans, alimony and child support, criminal and civil fines, court ordered restitution, and debts incurred pursuant to fraud or intentional wrongdoing.
The Chapter 7 process usually takes approximately 100 days to be completed from the filing of the Chapter 7 petition to the debtor's discharge and closing of the case.
San Diego Chapter 7 page information updated on 6/30/2014